Here are my SIX ways Healey can get Britain growing again: STUART MACHIN
By STUART MACHIN, CHIEF EXECUTIVE OFFICER AT MARKS & SPENCER
Updated:
I've never hidden what I thought of the last two Budgets. They were a disaster. Britain needed a plan for growth and got a pile of new taxes and regulations instead. At M&S we were left facing £150million of new costs each year, on top of a tax bill of around half a billion pounds.
Attention is now turning to the next Budget, the first by Chancellor John Healey. I have written to him directly to set out what needs to change, and why it can't wait.
Last month the Prime Minister promised Britain 'hope again'. It struck a chord, and you can see why. People want to believe things can get better. But the speech left big questions unanswered, above all what it means for business and the economy in the coming year.
I was glad to hear the Chancellor reference growth 16 times in his conference speech. He said it's 'the only long-term answer'. He's right. Now the Budget must match his words.
Marks & Spencer chief executive Stuart Machin says the Chancellor 'could get Britain growing by taking the handcuffs off business and putting money back in people's pockets'
John Healey's first Budget is in three weeks. Stuart Machin has written to the Chancellor directly
Retail has a big part to play. It's the engine of the everyday economy, employing more than three million people and keeping customers supplied with what they need. But margins are wafer thin. When the Government piles on costs, there is very little room to soak them up.
At M&S, we’re investing over £2billion in the next three years across our stores, supply chain and technology. But every pound that goes on new taxes is a pound we can't invest.
I know money is tight. I'm not asking the Chancellor to rip up his fiscal rules. But at the very least, he should start unravelling the mistakes of the last two Budgets.
So here are six ways John Healey could get Britain growing by taking the handcuffs off business and putting money back in people's pockets. The first three wouldn't even cost the Treasury a penny.
First, scrap the upcoming Deposit Return Scheme – it's patently ridiculous. Next October, you'll pay 20p more for every bottle or can of drink. To get it back, you'll have to lug bags of empties back to the shops – despite already paying your council for collections. And stores need to rip out shelves to make space for monstrous recycling machines. Retailers are spending tens of millions just to set it up, and will pay millions more every single year to run the scheme.
Second, make sure the Employment Rights Act doesn't ban the Saturday job by treating normal weekend shifts as 'low hours' contracts. The Chancellor spoke recently about his first job, washing pots in a pub. Mine was pushing trolleys at 16. With nearly a million young people out of work or training, don't let the small print pull up the ladder.
Stuart Machin with then-chancellor Rachel Reeves and long-serving M&S employee Allison Burnley, centre
Third, get a food and drink deal with the EU over the line. It's common sense. Cut the red tape with our nearest neighbours, so the European food we love costs less to bring in, and our brilliant British farmers can sell more abroad. Every month it's delayed, farmers and shoppers pay the price.
Fourth, undo the most damaging part of the disastrous rise in National Insurance: the cut to the threshold where employers start paying. It hit shops hard, because so many of our jobs are entry-level and part-time, often just a shift or two a week. It also hit our suppliers, particularly in farming and food manufacturing, and strict regulations meant most of those costs ended up with retailers. These pressures were always going to be felt at the till.
Fifth, fix business rates. Retail makes up around 5 per cent of the economy but pays over a fifth of all business rates. That's not sustainable. M&S alone pays around £170million a year. It's right to support the pubs, bars and music venues on high streets that bring our towns to life. But if you do that by taxing supermarkets, you're paying for a cheaper pint by loading costs on to the weekly shop.
Sixth, get rid of the packaging tax. Extended Producer Responsibility was sold as investment in recycling, but it's nothing of the sort. It's a tax of almost £2billion on food and drink, and even the official forecasters at the OBR now treat it as one. In April, M&S had to pay an extra £40million in one go. Scrap it, and shoppers will feel the difference.
The last two Budgets were a crushing disappointment for customers, colleagues and businesses. Now there's a new Chancellor and a new chance. The Prime Minister has promised 'hope again' and given us ideas for the next Parliament. But the Chancellor needs to restore hope among British businesses, and tell us what he’ll do now.
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