Family Businesses

Saqib Bhatti Excerpts

Wednesday 26th February 2025 Commons Chamber

[Saqib Bhatti (Meriden and Solihull East) (Con)]

I refer Members to my entry in the Register of Members’ Financial Interests. As a qualified chartered accountant, I spent the best part of a decade in my family business. [Interruption.] I am a fully qualified chartered accountant with a certificate to match. My family business, which was set up by my father, was a firm of accountants. I wish to reflect on some of the remarks made by those on the Government Benches. I do so with a degree of sadness and anger, which is reflected in what is said by the businesses in my constituency as well as by many family businesses across the country.

We should be in no doubt that the Chancellor’s Budget has been deeply, deeply damaging. My hon. Friend the Member for Hinckley and Bosworth (Dr Evans) put it correctly when, in his intervention on the shadow Chancellor, he said that the Budget is a toxic concoction of measures, which means that now, for the first time, many people will be wondering whether it is even worth setting up in business. The decisions that we take in this House matter, because they result in costs. Businesses, and family businesses in particular, are not just some opaque term; they involve individuals with hopes, dreams and aspirations. The political choices and decisions that the Chancellor has made and that Labour Members our now defending will incur costs for businesses, which will then be passed on to consumers and clients. Ultimately, they will feed into the cost of services and therefore the cost of living.

When we see the inflation rate increase from 2%, which it was when we left Government, to 3% now there will of course be consequences, especially given the decisions that the Chancellor is making. I understand that Labour Members may not want to accept that today, but they may well want to reflect on that.

The hon. Member for Hexham (Joe Morris) talked about our motion—I note that he did not name the Tory Members that he respects, and I hope that he does at some point—and I have to tell him that these are not things that we made up; they are things that businesses are telling us. This is what they are talking about every day. [Interruption.] I am more than happy to give some examples. The other day, I spoke to a family-run business, which is over 160 years’ old and has a subsidiary in my constituency. It has a £400 million turnover. It was looking to be a billion-pound turnover company by 2030, which means more jobs and more products for supply chains. They have had to put a hold on that because if the father of that business now passes away, the inheritance tax bill will come to about £2 million, and, as it is a family business and dividends will have to be found, it will have to find something like £18 million to fund that. The father said that it will probably have to sell about 7% of the business to be able to finance an inheritance tax bill, which is incredibly difficult for it to prepare for.

Eric Lyons, a butcher’s shop in my constituency, is over 100 years old. Nick, who I shall be meeting in the coming weeks, says that it is a great family business, which serves many of my constituents. He was very vocal on LinkedIn. I will not repeat everything that he said—it is not all repeatable—but he talked about the rise in national insurance contributions and the impact that that will have on the cost of the products that he is selling.

Rick Cressman from Nailcote Hall has a great hospitality business. What is happening to hospitality businesses is not reflected in the comments from Government Members. Hospitality businesses across the board are up in arms because the reduction in rates relief and the reduction in the threshold of national insurance—not just the increase in national insurance—are having a huge impact. Fundamentally, it means that young people will not get their first jobs in hospitality. They are the ones who suffer because they end up costing the most—not in terms of their salary, because they will normally be on the national living wage, but in terms of training costs and the time that is taken. Those are real consequences of the decision that the Chancellor is taking. I feel a great amount of sadness when I hear Members on the Labour Benches say that they listen but do not agree and talk about how great their businesses are doing. I just do not believe they are talking to those businesses, because at least 99% of the businesses that will be affected will not be happy about the changes.

When the Government came in, they had decisions to make. If the fictitious black hole is to be believed, they could have fixed the roof when the sun was shining. Now, when we are faced with a changing global scene, with Ukraine where it is, Donald Trump doing what he is doing and Putin coming to the fore, the Chancellor cannot commit to not coming back for more taxation. It is inevitable.