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Retail reacts to new PM: "prioritise measures that unlock business growth"

Tom Shearsmith
06 September 2022

Liz Truss has been named as the UK’s next Prime Minister, taking over from Boris Johnson tomorrow. Truss has already promised supporters a “bold plan” to cut taxes and deal with the energy crisis after winning the leadership race ahead of Rishi Sunak.

The new leader of the Conservative Party, who will meet the Queen tomorrow for her formal handover to become prime minister, has previously outlined plans to scrap Sunak’s proposed corporation tax and implement other tax reductions for firms.

She is being urged to immediately respond to the energy crisis, but has so far not established any plans that have reassured the public, businesses or organisations.

Key experts across the fashion and retail industry react to her appointment:

Melanie Leech, CEO of the British Property Federation:

“We urgently need strong Government leadership after a period of drift. The new Prime Minister must address the immediate cost pressures facing businesses and families, but in parallel there must a clear focus on the longer-term objectives to tackle inequalities across the UK and transition to a greener, high-productivity economy.

“We look forward to working with Ms Truss to harness the power and potential of the property sector to deliver the homes, work and leisure spaces that will revitalise our town and city centres and underpin our future prosperity as a nation.”

CEO of the British Retail Consortium (BRC) Helen Dickinson OBE poses for a portrait at BRC offices in London Bridge, London, England on February 7, 2019.

Helen Dickinson, CEO of British Retail Consortium:

“I’d like to congratulate Liz Truss on becoming leader of the Conservative Party. She will need to demonstrate strong leadership as the cost-of-living crisis deepens. Retailers continue to play their part, keeping prices as low as possible and helping households by offering discounts to vulnerable groups, expanding value ranges, raising staff pay, and offering reduced-cost or free children’s meals. The retail industry is ready to work with the new government to shore up consumer confidence and help deliver economic growth.

“Businesses need clarity on the government’s intentions as soon as possible so they can understand the inflationary impact of any policy decisions. One immediate way the Government can help retailers support their customers is to freeze the business rates multiplier for all retail businesses for the next financial year, protecting the industry from rates increases linked to inflation, and giving greater scope to hold down prices, protect jobs, and support the economy.”

Dee Corsi, COO of New West End Company:

“Congratulations to Liz Truss on her appointment as Prime Minister. We fully support her ambition to focus on a thriving London economy as a key component in ensuring that the wider UK remains globally competitive. We look forward to working with her and the new Cabinet to rebuild trade across London’s West End and support the one in eight Londoners who work there.

“As the country leans into harsh economic headwinds, it is crucial that the new Prime Minister and her wider Government prioritise measures that unlock business growth - namely a fundamental review of business rates, the reinstatement of tax free shopping and a re-evaluation of the UK visa system.”

Andrew Goodacre, CEO of British Independent Retailers Association

Andrew Goodacre, CEO of British Independent Retailers Association

Andrew Goodacre, CEO of British Independent Retailers Association:

“We hope that as well as campaigning to secure the votes, the new Prime Minister has also been working on plans to address the immediate economic challenges, both short term and medium term. Bira has been raising concerns since last October and we have continued to work with government departments to help them understand the challenges faced by retailers and the high street in general.

“In the short terms we need to see financial support given to the smaller retailers who are facing 50% increases in energy costs. At the same time we need to improve consumer confidence for the all important final quarter of the year. To do this the government needs to give certainly to the energy bills being paid with no more increases. This will allow households (and businesses) to budget and plan ahead.

“Another way of stimulating demand is to reduce VAT, and this should also be considered. In the medium term the government needs to introduce a grant or loan system that encourages smaller businesses to invest in energy saving technology, therefore reducing the demand for energy. This could also be done in the form of tax breaks and wholesale reform of the business rates system.”

Walid Koudmani, Chief Market Analyst at brokerage XTB:

“We saw softness in the UK pound in the immediate reaction to Liz Truss being named new Conservative leader and as a result, UK Prime Minister. The GBP traded at around $1.15 against the US dollar and earlier this morning reached its lowest levels in more than two years.

“It's pretty clear there is a degree of nervousness amongst UK investors to her premiership. We already know she wants to initiate £30bn worth of tax cuts and borrow more to plug the hole in funds. Moreover, it's looking more likely that as new PM, she will freeze energy bills to help contain the spiralling cost of living crisis. This would help to tame inflation but it will come at significant cost to government finances which will likely be paid for by more borrowing. This has led to inevitable concerns about the state of the UK economy and its public finances. UK debt now stands at 96% of GDP which is the highest since the 1960's.

“We've already started to see her unsettling comments about changing the Bank of England's mandate be rolled back, which cannot be underestimated. The independent Bank of England is a beacon to the stability of the UK for foreign investors. If the role of the BoE is amended or their ability to set interest rates independently of the government is changed, it would dramatically alter how international markets view the UK's financial landscape and not in a good way.”

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