Britain “needs to be a nation of shopkeepers once again” and “encourage enterprising entrepreneurs” to boost its economic prosperity, the chief executive of recruitment giant Reed has said.
Speaking on an up-coming episode of City AM‘s Boardroom Uncovered podcast, James Reed said if he was Prime Minister for the day, he’d “make Britain a destination for people who wanted to start and grow businesses”.
The chief executive added that he would “try and remove anything that was discouraging for that”.
When asked what the government could do to encourage entrepreneurs, Reed said: “The opposite of some of the things they’re doing at the moment.”
He added: “Some of the tax incentives are not helpful.
“Some of the changes that came in the last Budget have caused entrepreneurs to leave the country in quite large numbers. They’ve had damaging effects in that way.
“Some of the regulations aren’t helpful. Some of the pending labour market rules unhelpful. So there’s lots of things you can change.
“But by changing it and making it a destination for entrepreneurs and people who build businesses, you bring jobs, you bring wealth, and you’d bring the ability to pay for more of the public services that we want.
“You need a really thriving economy to support a country of 70m people and that’s what we should be prioritising.”
‘I’m hoping the Rachel Reeves’ Budget will leave business alone’
When asked whether he was optimistic about next month’s Budget, Reed said: “I don’t expect to be cracking anything open”.
“The financial situation looks very difficult and I don’t think the last Budget helped because I think it was discouraging to business, and that meant people leaving.
“So that might have made the financial situation more difficult.”
Reed added: “If the black hole, as I keep calling it, is as big as it seems to be, you probably need an increase in one of the main taxes, and it should be everyone that carries the cost, not just, business.
“It’s actually workers who are playing that, paying the extra National insurance, and some of them are paying with their jobs.
“The costs of being in businesses have been really squeezed.
“We knew immediately after the last Budget that this was going to be bad for jobs because employers were ringing us up and saying ‘we don’t going to hire those people we were looking for any more’.
“So that has come to pass and it’s continuing to squeeze jobs.
“I mean, we’ve had a long period of decline in vacancies – three years. That’s that’s unheard of.
“So I’m hoping that the Budget will leave business alone so we can get on with it.
“It seems to me that a smaller number of taxpayers are being asked to pay more and more when I don’t think that’s sustainable.”
Reed warns of ‘unintended consequences’
Reed was founded by Sir Alec Reed in 1960 and has been run by his son James since 1997.
The company floated on the London Stock Exchange in 1971 but returned to full family ownership in 2005.
In last year’s Budget, Chancellor Rachel Reeves’ decision to end two inheritance tax carve outs – known as Agricultural Property Relief and Business Asset Disposal Relief – sparked a strong backlash from family businesses across the country, with farmers particularly voicing their opposition.
On the impact the changes to inheritance tax will have on family businesses, Reed said: “It’s concerning because a lot of these businesses don’t throw off huge profits, but they do generate jobs and they do give families a living.
“If they’re not able to continue without paying a large tax charge, they’ll have to stop being in business, then have to sell that business. And who’s going to buy these businesses?
“So if we want an economy with more private equity-run businesses that leverage them up and take the cash perhaps this is a way to do it, but I don’t think that’s the intention.
“There might be some unintended consequences that arise from this that are unhelpful.”