UK economy on edge as AO World boss warns of recession risk amid policy pressure
AO.com chief John Roberts says inflation and Labour’s workers’ rights bill could push Britain into a downturn, as business costs and the tax burden weigh on growth
LONDON — The boss of AO World warned that Britain could be edging toward recession as inflation persists and Labour’s planned workers’ rights bill looms, saying high costs and the tax burden on the wealthy are squeezing businesses. John Roberts, whose company trades as AO.com, told the BBC that rising prices are feeding into costs across sectors and that recruitment has become harder as employers shoulder larger bills. “We’ve lived through a few recessions in the last 25 years – I think we’re heading into another one,” Roberts said, adding that “costs walk into businesses on legs” and those legs have become more expensive to bear. His comments underscore a growing drumbeat of frustration from business leaders about the government’s handling of the economy and concerns that rising taxes are driving wealth creators out of the country. Updated: 09:27 BST, 24 September 2025.
John Roberts also argued that taxation policy is prompting wealth to flee the United Kingdom, criticizing a narrative that “you can just keep taxing wealthy people and wasting the money.” He said he knows many people who have left the UK and warned that “you just can’t keep gearing the tax up” while calling for more efficient governance and tough, necessary decisions. His remarks come as authorities face expectations of a fresh tax push in November’s Budget from Chancellor Rachel Reeves and as data show the tax hikes already felt by employers are weighing on hiring and investment.
OECD data this week indicated Britain is on track to register the highest inflation among the G7 this year, heightening pressure on policymakers and businesses alike as costs cascade through supply chains and wage settlements. Roberts also criticized Labour’s approach to welfare and argued that the country must address the underlying cost base rather than rely on incremental tax increases. “We should be turbo-charged by our UK government, not disadvantaged,” he said, urging a focus on growth and job creation rather than policies that deter recruitment.
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Roberts’s comments come amid a broader chorus from business leaders who fear that recent tax measures and proposed regulatory changes could restrain growth. The Next boss, Lord Simon Wolfson, warned last week of years of anaemic growth and cautioned that further tax increases would have a demonstrable negative impact. Earlier this month, Stuart Rose, the former Marks & Spencer chief, said Labour had pushed the economy toward the “edge of a crisis,” while Allan Leighton, the former Asda chief, urged the Chancellor to avoid taxing everything.
The questions facing policy makers extend beyond the tax bill. Firms across the economy have reported a softening in private-sector hiring over the past year, with surveys showing job cuts in the private sector for 12 consecutive months even as the overall economy remains buoyant in some sectors. Economists note that a high level of public-sector borrowing and rising welfare costs complicate the outlook and could constrain fiscal flexibility in the near term.
Analysts say the government is caught between maintaining support for wealth creators and delivering social programs, a tension that has intensified as inflation persists and the cost of living remains elevated for households. The government has signaled that it intends to press ahead with a welfare reform agenda and employment protections, arguing that strong policies are needed to level the playing field. Critics, however, say such measures could raise the cost of hiring and discourage business investment at a time when the economy needs growth.
In the near term, observers expect Chancellor Reeves to detail how the administration plans to fund welfare provisions and other priorities in the November Budget, with markets watching closely for any signal of tax changes or offsetting incentives designed to spur hiring and investment. Meanwhile, Roberts’s remarks reflect a sentiment among business leaders that the country’s tax regime—paired with tighter employment rules and rising energy and wage costs—could threaten competitiveness if not balanced by growth-friendly policy choices.
With the economy at a crossroads, companies large and small are navigating uncertain demand and shifting costs as they plan for the next wave of investment. While some executives advocate for targeted support and clarity on regulatory reforms, others warn that broad tax hikes and aggressive welfare outlays could undermine the innovation and recruitment needed to drive recovery. The coming weeks are likely to intensify the debate over how Britain can balance fiscal prudence with the need to sustain growth, while ensuring that workers have protections and opportunities in a changing labour market.
The situation illustrates the broader stakes in Britain’s policy debate: accelerate growth through competitive taxation and pro-business reforms, or risk prolonged stagnation by pursuing measures that raise operating costs and chill hiring. As policymakers weigh priorities, business leaders like Roberts emphasize the imperative of a clear path to growth that can retain talent, attract investment, and reassure employers that the costs of doing business will not outpace the gains of expansion.