RUTH SUNDERLAND: If the Chancellor wants to boost growth, she needs to be realistic

No one wants Rachel Reeves to succeed more than I do. Not because I voted Labour (I didn’t), but because I want the country to prosper.

And because, as the first female Chancellor, she could be an inspiration to women.

Regardless of your party affiliation, I loved that your first act on arriving at Number 11 was to tell young women and girls that they should have no limits on their ambitions. How disheartening, then, that just weeks into the role you should be giving off so much negativity.

Instead of celebrating the latest figures, which show this year’s growth is the fastest in the G7 club of developed economies, she is fixated on criticising the conservatives. Her gloomy statement on the GDP figures did not include a single positive note.

To the disbelief of serious economists, he repeated his claim that he had been saddled with a £22bn black hole in the public finances. He keeps saying this, even though everyone knows that a large part of it is money he has decided to hand out to public sector workers with pay rises that outpace inflation.

He is waging a battle to discredit his conservative predecessors that he has already won, and if he continues, his victory will become a Pyrrhic one.

The supposed black hole is a fig leaf for wealth taxes that appeal to the left but will scare away talent and hurt businesses.

As John Neill, one of the UK’s most respected industrialists, says in our sister paper The Mail on Sunday, there is a populist argument for taxing the rich, “but in the real world you need rainmakers”.

Throughout his fifty-year career, Neill has earned a reputation as an enlightened capitalist and a pioneer of employee ownership.

In the 1970s he transformed Unipart, a division of the troubled British Leyland, into a hugely successful company with sales of £1bn a year. His views are well worth listening to.

So are those of Pascal Soriot, the chief executive of pharmaceutical giant AstraZeneca (AZ) and one of the UK’s best-performing CEOs.

Reeves is seizing another moment to score political points by cutting state aid to Arizona for a £450m vaccine manufacturing facility in Merseyside, announced in March by his predecessor Jeremy Hunt.

The Socialists may find it difficult to offer public money to a company valued at £200bn on the stock market.

But the reality is that in a hostile political climate, AZ may take its business elsewhere. It has already shown that it is willing to do so: in 2021, it avoided the UK and decided instead to build a plant in Ireland, which at the time it considered a more attractive environment.

Reeves should ask himself: what is more important: encouraging Jeremy Hunt or supporting life sciences, an area in which the UK still excels?

The sector generates 300,000 skilled jobs and is crucial for public health and the economy. A vaccine plant here could make us more resilient to the next pandemic.

And Anglo-Swedish company AZ, which produced one of the first COVID-19 vaccines, is one of the few truly world-class companies listed on the troubled London Stock Exchange. Let us hope it does not decide to become one of the growing list of defectors.

If he really wants to boost growth, Reeves needs to stop bashing conservatives, listen to serious business people and take a pragmatic, not ideological, approach.

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