Arora Group Founder Surinder Arora Talks UK's Business Outlook

Hotel tycoon Surinder Arora warns UK budget drives entrepreneurs away

Surinder Arora, who built Arora Group from nothing, argues the UK budget does little to stop Britain becoming uncompetitive for business. Rising costs such as the minimum wage push firms toward their limit while money flows to benefits and an unreformed NHS. Entrepreneurs are leaving for friendlier countries, and he says the government should court job creators and workers instead.

Takeaways

• The UK is becoming uncompetitive for entrepreneurs. Arora says the UK is driving entrepreneurs out while Dubai and European countries such as Italy and Portugal welcome them. He names Chris Rockos among those leaving and wants the government to take the loss of competitiveness far more seriously.
• Businesses are nearing their cost absorption limit. Companies can only absorb so many cost increases before they stall, Arora argues. The minimum wage increase alone would add a few million pounds to the wage bill of Arora Group, which employs over 3,000 people.
• Benefits and NHS spending need firm reform. Arora calls the budget fairly flat and objects to a £100 payment to about 20m people, adding roughly £2bn of spending. He says no government has tackled why NHS money fails to produce good service.
• Hospitality and care need welcomed foreign workers. His industry struggles to hire, Arora says. He wants care workers and hospitality staff encouraged to come and pay taxes, noting that travel and tourism alone accounts for more than 10% of UK GDP.
• An investor visa now would come too late. Arora criticises opening a route for wealthy overseas residents after so many entrepreneurs have already left. He would rather the UK welcome employment creators. The host describes the current employment and talent routes as fairly narrow.
• Founders relief helps the young but aims low. The relief limits tax on selling a business up to £10m. Arora says it makes no difference to him personally but does help young entrepreneurs, and the UK should aim higher by encouraging big entrepreneurs too.
• Arora chose to stay and fight. He arrived in the UK 54 years ago with nothing. After the Rachel Reeves budget a couple of years ago he first asked whether he wanted to stay, but decided to fight from within, as he did over Brexit.

How the budget landed

• The Confederation of British Industries said the budget announced by Chancellor John Healey on Wednesday lacked bold moves.
• Bloomberg reported economists warning that the Chancellor is pushing the boundaries on tax to pay the country's way out of debt.
• The bank levy surcharge doubled and is limited to 15 months.