UK business leaders warn of investment exodus and market strain under Labour policies

Senior figures in British business have warned that recent government policies are prompting companies to scale back or redirect investment away from the UK, a development they say is undermining growth and investor confidence.

In a column published in the Daily Mail, Lord Rose, chairman of Asda and former Marks & Spencer chief executive, said the country was "genuinely at the edge of a crisis," and other corporate leaders raised similar concerns. Sir Jim Ratcliffe, founder of Ineos, was quoted saying his group "cannot invest" in Britain and plans to divert future resources to the United States. Brian Gilvary, chairman of Ineos, described the UK as "one of the most unstable fiscal regimes in the world" for natural resources and energy, remarks reported to have added to market unease.

The warnings centre on a package of tax and regulatory changes introduced or signalled since Labour took office. Business groups and some executives have pointed to increases in employers' national insurance contributions, changes to oil and gas taxation, and the Employment Rights Bill as drivers of higher costs and lower incentives to invest. The Daily Mail column cited an Institute of Directors finding that 72% of its members expect the Employment Rights Bill to add costs to business, and it repeated an estimate that additional inflationary business costs could be around £5 billion a year.

Corporate decisions cited by critics include AstraZeneca's decision earlier this year to cancel plans for a £450 million vaccine manufacturing expansion in the UK and to redirect substantial research and development spending to the United States. AstraZeneca's chief executive, Sir Pascal Soriot, has been reported to be shifting R&D focus and considering relocating listings in response to UK policy changes. Separately, GlaxoSmithKline has signalled new investment in the Philadelphia area.

Industry executives have also criticised measures affecting the oil and gas sector. The column reported that Sir Jim Ratcliffe and others object to an increased windfall tax on oil and gas profits, introduced by the previous Conservative government and subsequently altered under Labour. Ratcliffe's stance and reported moves by Ineos to favour US investment have been cited by market commentators as evidence of a broader shift in sentiment among heavy industry investors.

Market indicators have reflected some of those concerns. Commentators pointed to rising yields on long-term government bonds — a measure the column used to argue that investor confidence in UK gilts had weakened — and linked higher yields to increased costs of servicing public debt. The article quoted an estimate that the interest bill on British government debt has risen sharply, adding pressure to public finances.

Chancellor Rachel Reeves has publicly emphasised support for sectors such as the creative industries and framed recent measures as part of a broader economic strategy; the column suggested, however, that business leaders see a mismatch between political rhetoric and the policy environment they face. The Employment Rights Bill is making its way through Parliament and is supported by unions; ministers have argued it will strengthen worker protections. The government has also defended tax measures as necessary to fund public services and stabilise the economy.

Economists and business lobbyists differ on the scale and permanence of the reported shifts. Some analysts say that while headline moves by major companies attract attention, investment decisions are complex and driven by long-term strategic, regulatory and market factors. Others warn that the combination of higher taxation, regulatory change and global competition for investment could influence decisions about where firms locate manufacturing, R&D and listings.

Observers note timing pressures for both business and government. The Employment Rights Bill is advancing through Westminster and the government is preparing a Budget in November. Business groups have scheduled engagements with ministers and have emphasised the potential economic consequences if firms continue to redirect capital abroad.

The warnings from prominent executives have added to an ongoing debate about how to balance fiscal policy, industrial strategy and regulatory reform while maintaining the UK's appeal to domestic and international investors. Ministers have defended their approach as necessary for fiscal stability and supporting public services, while business leaders and some City figures say policy adjustments are needed to restore investor confidence and safeguard jobs and investment in the UK.