Gails Bakery chairman Luke Johnson has warned the UK is already in a recession and since Labour has been in power “everything they have done has gone wrong.”
Johnson told GB News that he believes Labour “are a disaster” and that “nothing has gone right” for the economy under this government.
Johnson said that he accepts Labour was “handed” an “awful set of circumstances” and warned he is convinced there “will be a recession” this year and that the UK has most likely “already entered one.”
GB News Tom Harwood asked Johnson what has gone right and wrong since Labour has been in power.
Johnson said, “Nothing has gone right and almost everything they have done has gone wrong.
“I think they are a disaster. I accept they were handed a pretty awful set of circumstances.
“Post-war high levels of tax and debt and much higher interest rates than we have experienced before.
“There were many of the elements that could lead to a recession. I’m now convinced there will be a recession in 2025, we’ve probably already entered one.
“The mood amongst the entrepreneurs and investors I speak about this country with is more depressing than I can remember in 40 years of business.”
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It was then put to Johnson by Nana Akua that Sir Keir Starmer had warned it will be difficult until the economy is fixed, the Gail’s Bakery chief said he expects the recession will last for a year and a half, however, we “have to get there.”
He added, “Unemployment is rising and investment in this country is faltering.
“The sentiment, which is all important, is falling. There is this stark comparison with America where it’s utterly clear the new administration is full of optimism and confidence.
“They will unquestionably boost investment and employment and cheer on entrepreneurs and enterprise.
“Meanwhile, this Government has the Employment Rights Bill, 150 pages of red tape placed on businesses, that’s fine for big companies but small, medium sized businesses that don’t necessarily have large HR departments, 150 pages of extra regulation is not going to encourage them to create jobs.
“We are going to see a decline in work, we’ll see a decline in taxes and this Government will not meet its expectations for growth.
“The risk is, we get into a vicious spiral of a weak currency, which means we import inflation, we can’t lower interest rate because of that and we then have to put up taxes. This Government has no appetite to do what is necessary.”
Starmer has claimed that the economy if “starting to turn around” even though there are signs the UK is heading for a recession.
The Prime Minister said on Tuesday that the government’s number one priority “growth, growth, growth.”
According to Confederation of British Industry (CBI) analysis, the private sector are far from convinced and they are warning there will be a fall in activity over the next three months and prices will rise.
Businesses in the private sector are expecting for growth to plummet by 0.5% in the coming quarter, and the Institute of Economic Affairs economics fellow Julian Jessop warned this is “another UK recession signal.”
The CBI’s Alpesh Paleja added, “After a grim lead-up to Christmas, the New Year hasn’t brought any sense of renewal, with businesses still expecting a significant fall in activity.
“Anecdotes suggest that companies are being hit by lacklustre demand and caution among consumers, while also continuing to adjust to measures announced in the Budget.
“There is an urgent need to get momentum back into the economy.”
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