ICSM Newsletter: A look at Andy Burnham’s business IN tray with the current level of insolvencies in mind

By Harry Mottram: Despite political commentators wildly speculating on how the economy will fair with Andy Burnham as Prime Minister the markets have so far remained steady. Most will have taken a look at his track record in Manchester and noted some of his policies and how they have affected business in that region. The so-called Manchester Miracle and its business-friendly socialism has seen a boom in construction, improved public transport with buses brought back under public control through a franchised system, and a feel-good factor for the Greater Manchester area.

So far so good – but Burnham has also spoken favourably of bringing utilities like water – and potentially Thames Water – back under public control. That’s seen as popular with the public and those contractors who have to wait to get paid by the private owners. He’s also hinted at fairer taxes for small businesses and adjusting business rates – more devolution and more importantly giving local authorities more control over their spending and funding. Taxing the wealthy and cutting tax for the lower paid is another policy which will be popular while although he’s not planning on building thousands of council houses but his policy of teaming up with construction firms to develop more affordable housing in Manchester could be one way to solve the housing crisis. Add to that his desire to see the UK back in the EU eventually and you can see why markets have not panicked. He may well turn out to be just a more people friendly version of Kier Starmer with a chancellor who doesn’t penalise business.

One policy which could produce dividends is a change of attitude to Big Tech and Tech Bros. Why does Amazon pay a disproportionately small amount compared retailers in the high street, independent shops, SMEs like small manufacturers and printers? And why can’t we tax massive data centres, AI firms and driverless cars and vehicles – all of which reduce the numbers of jobs for the new cohort of workers? These are questions which need to be asked if we are to be able to fund universal social care for an aging population – something successive administrations have ducked.

Insolvencies have increased year on year - while late payment continues to be a major headache for small businesses, sole traders, SMEs and contractors - what business would like to see is stronger legislation to enforce punctual payment of invoices. A reversal of the hike in NI contributions by the Chancellor Rachel Reeves would also be welcomed, more resources and staff for the small claims courts to speed up cases - plus another look at the misuse of pre-packs and the cosy relationship of some insolvency practicioners and potential buyers of a business in administration. It's a full IN tray but the Labour Government have announced it's priority is economic growth. Whether that is achieved by more borrowing and boosting spending including infrastructure projects then business will welcome it. The main fly in the ointment is of course those factors out of the control of any incoming PM - another covid outbreak, Donald Trump's tariffs and the price of oil due to the ill-thought out Iran war.

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