RACHEL Reeves will pledge to take “the boot off the neck of business” – but was warned that raising taxes at the Budget will kill off growth.
The Chancellor insists that firms up and down the country can’t be strangled with red tape by regulators with red tape if the UK wants prosperity.
Reeves to deliver Mansion House speech tonightAFP
She will deliver the warning shot in the annual Mansion House speech as she attempts to turnaround the sluggish UK economy.
It’s the Chancellor’s first major intervention since she was seen in tears in the House of Commons as she attempts to win over City grandees following the national insurance hike in April.
She will say: “As I look ahead, it is clear that we must do more.
“In too many areas, regulation still acts as a boot on the neck of businesses choking off the enterprise and innovation that is the lifeblood of growth.
“Regulators in other sectors must take up the call I make this evening not to bend to the temptation of excessive caution but to boldly regulate for growth in the service of prosperity across our country.”
Earlier, Richard Hughes, boss of the independent watchdog, insisted that tax hikes may not be sufficient to get a grip of the debt crisis as it could lead to further sluggish growth.
He told the Treasury select committee that there are “reasons to worry” as they UK has been heavily exposed to shocks such as Covid, the financial crisis and the energy shock.
He also rejected suggestions that the Office of Budget Responsibility was driving government policy insisting the Chancellor could have met her fiscal rules without planning £5 billion of welfare cuts.
It comes after eight major regulators including the Financial Conduct Authority, Natural England and Environment Agency held talks with the Chancellor to spur growth.
She will also use the speech to convince the City she will rip up red tape to make the UK the best place for financial services in the world.
She will say: “We have been bold in regulating for growth in financial services and I have been clear on the benefits that that will drive with a ripple effect across all sectors of our economy putting pounds in the pockets of working people.
“Through better deals on their mortgages, better returns on their savings, more jobs paying good wages across our country.”
Proposals also include loosening the rules to allow more first-time-buyers onto the property ladder by allowing wannabe homeowners to borrow more than 4 and a half times their salary.
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