Lord Wolfson has hit out at Rachel Reeves’ policies. (Image: Getty)
The boss of a high street giant has issued a six-word warning to Rachel Reeves over the state of the economy. The Chancellor is under pressure after new data revealed that there had been no growth in July, with manufacturing output seeing the biggest contraction for a year. Now, the chief executive of Next, Lord Wolfson, has issued a six-word warning and said that, over the next year, “at best we expect anaemic growth”. The retail boss added that progress is being “constrained” by four factors, namely declining job opportunities, new regulation that “erodes competitiveness”, Government spending commitments that are “beyond its means”, and a rising tax burden that “undermines national productivity”.
Lord Wolfson said he was also worried about falling employment. He told the PA news agency: “We first raised concerns about a potential weakening in UK employment in our report two years ago. Since then, vacancies have continued to fall, and PAYE payroll numbers are now moving backwards.”
Next is a mainstay on UK high streets. (Image: PA)
He added: “The problem appears to be that employment, particularly at the entry level, faces the triple pressure of rising costs, increasing regulation, and displacement through mechanisation and AI.”
Ms Reeves is due to present her Budget on November 26.
Lord Wolfson cautioned her against hitting the economy with another tax blow, similar to the increase in employers’ national insurance contributions.
He said hikes like these are “particularly bad for the economy, because they inhibit economic growth”.
“They don’t just suck money out of the economy, they change people’s behaviour,” Lord Wolfson added.
The Chancellor admitted earlier this month that higher taxes could hit economic growth.
She said: “I do recognise that tax policy does impact economic growth.”
Rachel Reeves is due to present her Budget on November 26. (Image: Getty)
Ms Reeves added she recognises that “to make sure that the numbers add up it’s not just what you bring in, it’s also what you’re spending”.
“But crucial for all of this is economic growth,” the Chancellor said.
“If you can grow the economy, you can make these decisions around tax and spend so much easier.
“One of the reasons why taxes have risen to such a high level is because we’ve had such poor growth and such low levels of investment and such a deterioration in our productivity performance, both compared to the past, but also compared with other countries.
“I’m determined to drive those things up, and that is why growth continues to be the number one mission of this government, and tax policy also needs to reflect that mission.”
