FTSE 100 Boss Warns: Budget Inconsistent with Growth

The recent Budget presented by Rachel Reeves has sparked concern among FTSE 100 bosses, with David Sleath, CEO of Segro, warning that it is "not consistent" with the government's stated aim to boost growth. This sentiment echoes a growing backlash from company chiefs, who fear that the tax increases will lead to job losses, higher prices, and company failures in sectors like hospitality and retail. The Budget's focus on raising taxes, rather than stimulating the economy, has raised questions about the government's commitment to its pro-growth agenda.

The Budget, described as the biggest tax-raising fiscal statement in history, places a significant burden on businesses. David Sleath, CEO of Segro, a £10bn FTSE 100 warehouse developer, warned that the Budget's tax-raising policies may not stimulate the economy. He specifically highlighted two areas of concern: the slow grid connections, which hinder investment in data centers and power plants, and the proposed business rates reform that could disproportionately affect hundreds of businesses. Sleath argued that the latter is a "clunky sledgehammer" to level the playing field between traditional high street retailers and online players, potentially hurting innocent bystanders.



The proposed business rates reform aims to "level the playing field" between traditional high street retailers and online players. However, David Sleath warns that the reform could hit "hundreds, if not thousands" of British businesses that have nothing to do with online retail, such as food processing factories, film studios, and manufacturing businesses. This could potentially slow down the growth of these companies and the broader economy.

To better support growth, the government could consider alternative policies such as improving grid connections, offering targeted tax incentives, investing in infrastructure, and supporting education and training programs. By implementing these alternative policies, the government can better support growth and address the concerns raised by the FTSE 100 boss.

In conclusion, the Budget's focus on raising taxes has raised concerns among FTSE 100 bosses about its consistency with the government's pro-growth agenda. The proposed business rates reform, while aiming to level the playing field, may have unintended consequences for hundreds of businesses. The government should consider alternative policies to better support growth and address the concerns raised by the FTSE 100 boss. Investors should monitor the situation closely and consider the potential impact on their portfolios.