A lot has been said about a recently leaked memo from Angela Rayner to Rachel Reeves and most of it has been focussed on the politics. But I think there is a bigger issue we should be talking about.
The memo reveals more than just internal Labour tensions — it exposes the UK’s deeper problem: we are not a growth economy. And judging by this document, we don’t even want to be. And this is not a new issue. For the last decade we appear to be obsessed with anything BUT growth.
Nowhere is there any serious mention of growing the pie — only how to slice it. As a business owner and property investor I looked at this memo and sighed once again. Nothing for us here but more potential pain! Let’s look at the main proposals and consider if any of them help or hinder growth in your sector.
- Reinstate the pensions lifetime allowance — penalising long-term savers.
- Raise the bank surcharge to 30% — further discouraging lending and investment.
- Scrap inheritance tax relief on AIM shares — undermining support for high-growth small businesses.
- Eliminate the £500 dividend allowance — a blow to small investors and entrepreneurs.
- Freeze the additional rate income tax threshold beyond 2028 — stealthily dragging more earners into higher taxation.
- Increase the annual tax on enveloped dwellings — hitting property holders without addressing supply.
- Close the commercial property SDLT loophole — more friction in already sluggish markets.
- Align dividend tax with income tax — another tax increase on business owners and risk-takers.
This isn’t just a missed opportunity — it’s a mindset. There’s no plan to grow the economy. Only to redistribute what already exists. It reflects a political class that’s obsessed with how to spend money — but uninterested in how it’s actually made.
It would be refreshing to see a memo that had proposals on:
- Boosting business confidence
- Encouraging innovation
- Supporting job creation
- Unlocking housing supply
- Reforming planning or productivity
Until growth is treated as the foundation for everything else — not just an afterthought — we will stay stuck in a cycle of stagnation, frustration, and short-term fixes.