Next chief urges government to cut spending and reduce red tape

Lord Wolfson, the chief executive of Next, has called on Chancellor John Healey to reduce public expenditure ahead of next month’s Budget. The retail leader warned that the government cannot resolve a funding crisis through increased spending, urging policymakers to clamp down on costs and avoid further tax increases. Instead, he advocated for a focus on supply-side measures and the reduction of planning regulations to stimulate economic growth.

Speaking to the media on Thursday, Wolfson stated that the long-term trajectory of the economy will only improve if the government brings its spending under control. He emphasised that the UK is forecast to spend over 100 billion pounds more than its income this year, leaving little room for increased borrowing. In Next’s half-year results, he noted that there is little scope for the government to stimulate growth through spending or alleviate inflationary costs in fuel and energy. He argued that the only effective ways out of this predicament are to control spending or boost growth, preferably both.

Wolfson, who has led Next for 25 years, suggested that Labour should not seek further tax cuts but rather ensure that the tax burden does not rise further. He described the request for tax reductions as too strong, maintaining that any organisation cannot continue to spend significantly more than its income. This stance comes as other retail leaders have increased pressure on the government to reform business rates and reduce employment costs ahead of the October Budget.

The Next chief executive also highlighted the need to slash red tape surrounding building regulations, biodiversity rules, and archaeological restrictions, which he said are holding the economy back. He believed that releasing this pent-up demand would significantly boost growth. Additionally, Wolfson defended the natural evolution of the high street, pushing back against recent political proposals to revive UK high streets by cracking down on gambling and vape shops and cutting business rate bills for pubs.

He stated that the most important action for the government is to allow high streets to develop organically. Wolfson advised against attempting to dictate specific retail mixes, such as deciding which locations should be shops, restaurants, or pubs. Instead, he urged policymakers to let the market determine what people most want. In the UK, Next’s in-store sales dipped by 0.4 per cent in the six months to July, while online sales rose by eight per cent. Wolfson expects high street sales across the group to continue declining gradually, advising against attempts to return the high street to its previous state.