Chancellor Rachel Reeves's Budget has sparked fear amongst businesses (Image: PA)
A top businessman has revealed he is “despondent” about the state of the UK economy.
Stuart Rose, the former chairman of Asda and Marks and Spencer, revealed firms are facing a “very tough” time amid “no growth”, “poor productivity” and “a very, very large tax burden”.
He blasted the “very bloated public sector”, adding “the prospects are not good”.
A major study, published on Boxing Day, revealed Rachel Reeves’s bombshell Budget has stifled economic growth and dampened business activity in the UK.
READ MORE: Tax warning as Reeves poised for further raids after Labour's disastrous start
Stuart Rose warns of a lack of productivity (Image: Bloomberg via Getty Images)
Lord Rose told BBC Radio 4’s Today programme: “I like to go into every business period and every year thinking to myself that it’s going to get better.
“But I’m a bit despondent at the moment. I think it is very tough. We all tend to look in the mirror to see what we see and how could we improve ourselves?
“We think about how we did things well, or badly, last year and how can we improve ourselves and we either do something about it or we don’t.
“We have no growth. We have poor productivity. We have a very, very large tax burden, which has just been increased with the last Budget.
“We have got a very bloated public sector, so the prospects are not good.”
The Chancellor’s October tax raid means GDP forecasts are lower than they were a year ago. Furthermore, Labour’s employment reforms will hamper investment over the coming years.
The stark outlook is revealed in the latest data from the influential Centre for Economic and Business Research (CEBR).
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Despite forecasting accelerating economic growth for the next couple of years, this will be at rates lower than previously predicted.
The CEBR expects GDP will grow by 1.3% in 2025 and 1.4% for 2026. But this is lower than the 1.9% and 1.6% predicted at the same time last year.
Its report says the weaker forecasts reflect the reaction to Ms Reeves Budget.
Lord Rose, the former Chairman at Asda and Marks and Spencer, stressed that improving productivity is key to reviving the British economy.
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He added: “I mean, just a simple thing, I read the other day that there are more civil servants in the Ministry of Defence than there are on the front line in the Royal Air Force and the Navy put together. That is unsustainable.
“And whether it’s the National Health Service, whether it is policing, whether it is the infrastructure problems that we’ve got, if we do not improve productivity in the country, then nothing is going to happen.
“This is about people working together. It’s that old phrase that I think John Kennedy said – ‘don’t ask your country what it can do for you. Ask yourself what you can do for your country. We’ve all got to pile in.”