Retail chiefs including Marks & Spencer executive chairman Sir Stuart Rose, Next chief executive Simon Wolfson and Harvey Nichols chief executive Joseph Wan have backed the Conservative party’s plans to reverse part of Labour’s National Insurance rise.
The Tories have outlined plans to halt the NI increase for those earning less than £45,000 if they win the general election by making £12bn efficiency savings in government.
Rose, Wolfson and Wan put their names to a letter sent to the Daily Telegraph alongside other key retail figures including Kurt Geiger chief executive Neil Clifford, Mothercare chief executive Ben Gordon, Peacocks Group chairman John Lovering and Matalan chief executive Alistair McGeorge. A total of 23 senior businessmen from all industries signed the letter (below).
‘Cutting government waste won’t endanger the recovery – but putting up National Insurance will’
Letter to the Telegraph from business chiefs
In the letter the businessman protest that the 1p in the pound rise in both staff and employers’ NI contributions set to be brought in next April under a Labour government, could lead to widespread job cuts and put the economy in peril.
They argue that cutting public waste and bureaucracy is crucial to finding money to reduce Britain’s debt.
In a move which will further humiliate Labour, Rose sits on the Prime Minister’s Business Council.
The Tories hope that this is a sign that the City now supports party leader David Cameron and shadow chancellor George Osborne’s policies.
However, this morning Labour hit back at the Tories’ pledge, saying that the businessmen have been “deceived”.
‘The point is, this is not pain-free and Mr Cameron and Mr Osborne are peddling a deception’
Business secretary Lord Mandelson
Business secretary Lord Mandelson said today that the Tories could not make their sums add up without increasing VAT.
Cameron also fought back, calling Mandelson’s comments “patronising” and “wrong” and an indication that Labour was in “meltdown”.
Mandelson said at a press conference alongside Chancellor Alistair Darling and streamed on the BBC’s website: “The point is, this is not pain-free and Mr Cameron and Mr Osborne are peddling a deception.”
SIR – Between us we run some of Britain’s largest companies and employ over half a million people. We are responsible for ensuring that our businesses and our employees come through the recession in good shape.
The Government’s proposal to increase National Insurance, placing an additional tax on jobs, comes at exactly the wrong time in the economic cycle. In a personal capacity, we welcome George Osborne’s plan to stop the proposed increase in national insurance by cutting Government waste. In the last two years, businesses across the country have cut their costs without undermining the service they provide to their customers. It is time for the Government to do the same.
‘As businessmen we know that stopping the National Insurance rise will protect jobs and support the recovery’
Few would argue that the state cannot improve. In the last few years, the private sector has improved its productivity by around 20%, while productivity in the public sector has fallen by 3%. Savings can be made by removing the blizzard of irrelevant objectives, restrictive working practices, arcane procurement rules and Whitehall interference. Mr Osborne’s announcement marks the beginning of this debate. As taxpayers we would welcome more efficiency in government.
As businessmen we know that stopping the National Insurance rise will protect jobs and support the recovery.
Cutting government waste won’t endanger the recovery – but putting up National Insurance will.
Chief Executive, Kurt Geiger
Chief Executive, Sainsbury’s
Chief Executive, Mothercare
Chief Executive, Matalan
Sir Stuart Rose
Executive Chairman, Marks & Spencer
Group Chief Executive, Harvey Nichols
Chief Executive, Next