One of Labour’s top business supporters has strongly criticized the Rachel Reeves Budget, warning that it could severely impact businesses and lead to widespread job losses.
In a strongly worded letter, Labour donor Sacha Lord threatened to leave the party over the chancellor’s tax-hiking autumn statement unless immediate changes are made.
Mr. Lord, who served as Greater Manchester’s night-time economy adviser under Mayor Andy Burnham for seven years, expressed deep concerns about the budget and its effects on the hospitality sector. “I urge you to act before irreversible damage is done,” he cautioned the chancellor.
Mr. Lord is the latest in a growing list of business leaders to oppose the policies set forth in October, amid increasing signs that the Rachel Reeves Budget has hindered economic growth and contributed to significant job losses.
“I myself have been a Labour Party member for four years. I am now reconsidering this position.
“I attended your manifesto launch, I supported you in your bid to become the government, and I believed you had a deep understanding of the problems on the ground. Not anymore. I heard Labour declare itself the party for business and growth. I no longer believe that to be the case.”
Sacha Lord
Mr. Lord, who also chairs the Night Time Industries Association, emphasized that the hospitality sector employs 3.5 million people and warned that the government is “threatening its very survival.”
He cited projections that up to 9,000 pubs could close this year, including one major pub chain that has halted plans to open five new locations. “These businesses are not just numbers; they are the backbone of our high streets, our communities, and our global reputation,” he said.
He warned: “If nothing changes, thousands more businesses will collapse, and Labour will be responsible.”
“The hospitality sector is an essential driver of growth, a major employer, and an irreplaceable part of our social fabric. It can drive the economy out of the stagnation it has found itself in. It deserves recognition and support to prevent thousands of closures. chancellor, you must do better.”
Sacha Lord
Alarms Over Rachel Reeves Budget
As part of the Rachel Reeves Budget, the chancellor increased employer national insurance contributions and eliminated inheritance tax exemptions for farms valued over £1 million.
Economists have labeled the national insurance hike a “tax on working people,” warning that it will lead to lower wages and job losses. Family farm owners, meanwhile, argue that the inheritance tax changes will push a generation of farmers out of business.
Additionally, Ms. Reeves announced a 6.7% rise in the minimum wage, a move that business leaders say will further burden already struggling enterprises.
Just last month, Sainsbury’s announced plans to cut 3,000 jobs in the UK due to rising costs, including tax increases and wage hikes introduced under the Rachel Reeves Budget.
The Confederation of British Industry (CBI) has also warned that the economy could face “the worst of all worlds” following the chancellor’s policies.
In an attempt to regain economic momentum after months of stagnation, Ms. Reeves recently introduced measures aimed at “turbocharging” the economy, including backing a third runway at Heathrow and revising Britain’s planning regulations.
However, this move sparked further controversy, with Labour donor and energy tycoon Dale Vince warning that the Heathrow expansion would be a mistake and provide only “an illusion of growth.”
Shadow Business Secretary Andrew Griffith echoed these concerns, stating: “Even Labour members and supporters now recognize that Labour has put Britain’s nightlife in the crosshairs.”
“The chancellor’s choices are bad for jobs, bad for hospitality, and bad for growth.
“Under new leadership, the Conservatives know that only business creates growth. It’s high time Rachel Reeves called off her war on private enterprise.”
Andrew Griffith
With business leaders, economists, and even Labour supporters voicing discontent, Reeves faces increasing pressure to rethink her budget policies before they take a lasting toll on businesses and employment across the UK.
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