The UK has a new Prime Minister. Now come the big questions.

Welcome to a special edition of Business Without Bullshit.

And we are going to raise a few questions we have for Andy Burnham.

I am Andy Ory, the rebel accountant, and I'm joined by the lovely lawyer Gemma Hotter.

Gemma.

Hi, Andy.

Thanks for having me back.

Anytime.

So we're just going to have a little open conversation from an accountant to a lawyer, about what we think about Mr. Burnham, as everybody's talking about him.

And I think you had some good questions, Gemma, so let's start there.

Yeah.

So I know everyone talks about how well Andy did in Manchester in terms of growth.

They got about 3% growth in Manchester, economic growth, which was much higher, actually, than the rest of the uk.

So one of the ways in which they did that was they massively increase their inward investment into Manchester.

So it's known as greenfield investment, which is effectively where international companies, they decide to expand into the uk, and what they did was they would go to Manchester, take premises in Manchester, employ people in Manchester and actually build up their UK presence within Manchester.

People from overseas.

People from over.

Companies from overseas.

Yeah, expanding into Manchester.

So if.

If the.

Part of.

The.

Part of Labour's manifesto is all about growth, I do wonder whether he's going to focus a lot on inward investment into the UK as a whole, rather than just Manchester.

At the moment, the government has effectively axed 600 of the overseas DBC, sorry, Department for Business and Trade Positions.

And so that's not really aligning with building up our inward investment.

So I think that would be one of my questions is how does he see FDI playing a role in this government?

No, it's a great question and I think people massively underestimate how important FDI is for this country.

Foreign direct investment, which just means overseas companies coming here to build businesses.

The UK historically has been amazing at it, really.

That is our history, whether, you know, colored though it is, of having an empire and all these things.

But it has always been a trade relationship and we've always encouraged people.

And the Department of Trade, as you mentioned, has had posts all around the world encouraging people to come and set up business in the uk, which is, you know, some countries don't do it because they think, well, I don't want people to come in to compete with my local business.

But UK has always had that view that we should trade and doors swing both ways.

And if you ask people in that sector, the Department of Trade, for all its faults, is one of the best at doing it globally and the best at attracting people into the UK and say, come, you know, welcome.

The doors are open.

So it's always for us as a business, as Uri Clark, who deal a lot in that world, very sad when we hear DBT being slashed hard because actually you really want to, you really want to invest in that area.

So I think it's very well said that they need to.

Hopefully he'll reverse some of that because it's a fractional cost.

I mean, you know, there's been London and Partners as well and Department of Trade.

These things work in unison to try and encourage people to come and build businesses here.

The other bit that they've got to think about is visas because there are business visas, you can get them and there's obviously such an anti immigration vibe.

But we can tell you as people who deal with the business community trying to come into the UK that business visas have been become much less, much harder to get used to be.

The entrepreneur visa, which would allow someone to come here if they invested £200,000 into a British company.

You had the investor visa, which used to be a million pounds.

These are all scrapped and gone.

Now you can bring in people and you can find people to come in on sponsorship, license and build, you can build businesses, you can set up businesses, but you want to make that door as easy as possible if they're coming here to invest money and build businesses.

Yeah, I think actually on the back of that I would also my other question to him would be what incentives are you going to give to those businesses to actually Invest into the UK?

So we used to have like a 19% corporation tax which was relatively attractive.

Now it's at 25%.

It's pretty much the same as every other developed country really.

So what are they going.

We used to have better really R and D tax reliefs for them.

The employment, the Employment act has come out which I know is all about workers rights here or employee rights, I think is a more accurate description of it, seeing as there's lots of people who aren't employees.

But that is incredibly detrimental.

When people would look at Europe, they would be scared of continental employment law which was so strict and the UK had the most relaxed employment law, I. E. This two year period they've removed that.

They removed the R D as you say, they, they, you know, increase corporation.

So I'm just like, I would really like to ask him what incentives is the he thinking about to actually attract international investment into the uk which is ultimately just going to lead to growth, lead to more tax within the UK that will ultimately fund all of the things that The Labour, Labour government want to do 100%.

And actually the stock market, unfortunately, the London stock market has been taking a kicking over the last 20 years for various reasons that they've made that now, unfortunately, listing in London is not an attractive process.

But, you know, as our dear colleague Paul Webster will remind us, the UK is still an amazing place to do business in terms of.

It is a business community, common law, time zones, all these things.

But as you say, they've chopped this stuff down.

You know, what I would suggest they do as a tax person is a UK holding company is still, even if you ask, one of the best holding companies in the world, and we've got a session to talk about that in a bit.

But if you then lent into that.

You know what I felt was so sad with the R and D relief is the R and D relief used to allow you to conduct R and D anywhere in the world.

And people would say, that's crazy, you're paying overseas countries for employees.

But it was so genius, actually, because what it meant is that you would set up your holding company to hold your intellectual property and that would build up this great investment in the uk, which there's a lot of research that suggests the more IP a country holds, the wealthier it is and that over the long term, the UK would reap the benefits from owning all of the ip.

So, yeah, there's definitely things they can do.

Unfortunately, I guess the Employment Act's not going to get reversed anytime soon.

And it is definitely a detriment.

No, I don't think so.

But there are so many other ways that they could attract international businesses.

So we'll move on.

Yeah.

The next one I think would be.

He's spoken so much about the North.

If anyone hasn't read it, I think read his book, which is called Head North, I think.

I think that will give you a real insight into what he's going to be thinking about.

But that is all about investing in the North.

I would like to ask him what role he thinks London is going to play during his premiership.

This has gone very badly wrong in the past, by the way.

People won't realize.

But the leveling up, sorry, the Northern powerhouse thing that they sort of got into before Boris and everyone actually was very detrimental to London because London was sort of seen as.

You basically keep feeding this.

It's not fair.

Yeah.

And the it not fair thing is definitely the wrong road to go down because.

Yes, okay, London is this huge powerhouse in terms of, you know, the, the, the salaries and everything.

And Then we go and build Crossrail or, or the Elizabeth line as it's called, or the Lizzie Line.

And people say, well that's not fair.

Well could I also counter as a Londoner that schools in London, the hospitals in London, they are, you know, massively over subscribed.

And I know so many people who've moved their families out of London, moved up north and stuff and they have a better quality of life, they're getting better schooling, they're getting better, better medical.

Care, better value for money.

Better value for money.

Things expensive in London.

100 Salaries are so much higher here.

I would say, yes, that I think that I'm from, okay, I'm half English.

My English family is from Lincoln, which is Midlands.

But to north.

But to London, that's north.

Yes.

North of what I have an interest here, but I think there is inequality between the north and the South.

However, there's also like, don't forget there is massive inequality within London itself as well.

So if we just focus on, on the north, like we're going to completely forget about.

There is already inequality.

But it's this negative narrative to me too.

It's a bit like this sort of narrative of blame the rich or something.

We've got to stop these negative narratives.

If we, if we create a narrative where somehow we're saying that it's not fair.

I was in like, you know, London's doing all this and we're not.

You're just feeding this sort of thing when underneath it, let's have love for everywhere.

If that's not too strong a word, London, I mean, let's just be really honest, the country would be screwed without London.

And yeah, I say that as a Londoner and I'm biased or something.

But yeah, I think it's something like London has put £26,000 into the tax system and get 22 grand back.

And up north people are putting in 16, you know, 12,000 and getting back 16,000.

I mean, you know, when people think of the UK, I always used to laugh in hip hop.

They used to always say France, Germany, London.

You know, people, you know, it's such an incredible, you know, we are so lucky to have this incredible international city.

But sure there's problems with that dominance, but I would love, I would love it not to feed this sort of anti London sentiment that somehow, and I think that's politics, isn't it?

Yeah, I think so.

So I think so.

I met Andy Burnham really briefly south by Southwest a couple of years ago in, in Austin and he was lovely like when I met him, we had a little chat.

He was lovely.

But when he got to talking about his book, that was what he was.

He was speaking about.

He had a really.

I'm sorry, he had a really anti London sentiment.

And when I'm over there, when I'm in Texas, I'm there to promote the UK as a whole.

Yes, I, I'm based in London, but if for somebody, say, in manufacturing or in logistics, they should be somewhere else.

I'm going to promote another part of the UK as well.

I'm not just promoting London.

He could equally promote the UK as a whole when you're in Texas.

Rather than, Rather than bashing London.

Yes.

It's inadvertent, the bashing.

If you start saying, we've got to focus on here, it's sort of is fulfilling that thing.

I think the other interesting thing is a business coming into the market.

London is this talent pool.

Yeah.

As you say, this huge disparity.

But there's incredible talent you can get in London.

So for a lot of the international businesses, it's like you might hire your CEO in London who, you know, wants, wants the London lifestyle, but then you have access.

So the southeast of England, as I understand it, is one of the richest areas in Europe.

Dear old Martin Wolfe came on the podcast.

You could check out that episode and explain this to us.

But southeast of England is some of the richest areas in Europe and the rest of the country is some of the poorest areas of Europe.

And the fascinating thing Martin said is it's been that way for ages, hundreds of years.

And when they look at a project, they can see, see the value.

You go to say, oh, I'm going to build a big infrastructure project in, in London.

How much do we get back?

We get loads back.

I'm going to go do that up north.

How much to get back?

Well, not so much.

So this is sort of constant, perpetual problem.

But from a business point of view, that means you can access labor at good value, you know, and hopefully those wages rise, but also find that real top talent that would, you know, like to go and live in these metropolitan hubs, you know, Anyway.

Yeah.

And next one, I would really like to know what his plans are for us to compete with the US on AI.

Great question.

I know, I know.

He's.

He's put in place the first ever AI Cabinet minister, which I think is a brilliant thing to have done.

But we really need to be competing.

We can't just be relying on the us I think with current geopolitics we've seen.

We can't just rely on the US to always be friendly.

They've done one good thing out of Rachel Reeves and I'm always picking up Alex to pledge.

Another great guest of the show who's her personal.

They've done great things on EIS, the Enterprise Investment Scheme, to pump it up to 24 million to try and stop.

Because the real problem you're talking about is we're good at starting these companies and then they need the big bucks so they get sucked into America and we've got to try and stop that.

So they've done on EIS up to the 24 million.

But the other bit you've really got to fix is the stock exchange was a huge problem for life sciences companies too.

I believe that now UK companies over the period, over the period of the, over the last 20 years, I think, you know, it's doubled the footsie or something.

But the American, you know, the NASDAQ and stuff have gone up 6, 10 times these sort of huge figures.

And if you can't, if you're not getting the right valuation.

So that is all about getting people to, getting the pension funds and everything here to invest in our local market.

You know, Andrew Craig, an expert on this again, another friend of the show, and I think you've got, you've got to fix that funding because it's not starting these AI companies.

We started Google, DeepMind, you know, it's, it's, it's, it's keeping them here and having the power of the investment here.

And Universal Quantum were recently in the Financial Times, which, you know, another good friend of the show, amazing Quantum computing company and the article was all about.

We've screwed up loads of industries, that is, we don't own them anymore.

We sold ARM holdings, you know, Deep Mind, we keep losing these brilliant companies.

Can we hold on to Quantum?

So some races, some, you could also say the AI race, maybe to some extent America's already won that.

But there are other industries too, life sciences industries and Quantum.

Quantum, you know, that we could really get into.

But we've got to, we've got, you know, the reason they've tried to change the isis, so you can't do cash isis that some people are outraged about.

It's just because they're trying to.

A, it's better for you to put it in stocks and shares unless you need the money in six months.

Don't put in, don't put it in cash, you're getting nothing.

B, they really want you to Invest in the UK stock market and we've got.

We've got to back British businesses and it's a huge institutional problem.

We've gone from sort of 50% of pension money in UK funds down to like in a half a percent or something crazy.

And it was first of all caused by an accounting standard, may I say, a bloody FRS standard that came out, that first started affecting this move.

But he would have to really genuinely look at that to say that you can come.

Not only we're going to start these great British businesses, but they're going to stay here and they can get that massive funding that they need to sort of drive and grow.

Yeah, great question.

We're at 130 anymore.

How do we want to get on to like, wealth tax?

Like, I don't.

Oh, so let's do.

I think also the question that people have been asking me, it's like, what should you do for tax?

And there's a lot of stuff about wealth tax thanks to Gary Stevenson, also been on the show, but, you know, he's very.

It's been around for ages, but he's very much jumped on that band work.

And I opened the newspaper this morning and saw Gary Lineker and the patriotic millionaires have signed a letter to him saying, we want to pay more tax and stuff, which is great and noble.

Their idea is what?

That you pay.

That's Gary's suggestion.

The wealth tax movement is a big, long conversation.

There are many versions that people have tried.

There's 12 countries globally that have tried it.

Nine have given up.

There's a few left.

Spain, Norway and Switzerland.

Switzerland seems to be the only one that's really working.

Norway's turn theirs up.

Everyone left.

45 Billion or something left.

But Switzerland doesn't have capital gains cats doesn't have inheritance tax.

So people who don't do tax, they don't understand, you know, they'll hear it like, yeah, other countries have got it.

It's like you've got to compare the systems.

We have a lot of tax in this country.

We have income tax, wealth tax, I mean, sorry, income tax, capital gains tax, inheritance tax.

You know, we've already got a lot of stuff going on.

We've got rid of non doms and all of this stuff.

So I think wealth tax is a terrible idea.

I'm absolutely with Dan Needle on it.

I think it's populous claptrap being driven by people who do not understand tax.

I do not understand, I do not understand this.

And pick up Dan Needle for actually being out there and fighting the good fight and we're trying our best.

Is that if you wanted to work out what to do with tax, why didn't you ask some tax people.

Stop asking freaking journalists and economists what we should do about tax.

Because you really have to understand the system.

It's nuanced, it's complicated how it interacts.

We, you know, you could go, what's funny?

We went to the tax awards and I was at the tolly stacks.

Wasn't meeting all the sort of great and the good attacks in this conversation.

Everyone has the same opinions.

You ask them what should we do?

And it's like, well, get rid of the national insurance hike.

Bring back, bring back entrepreneurs relief.

Where we used to have to first 10 million that you could earn was a 10% tax rate.

Do not put capital gains tax up at the same rates of income tax because people say, well it's not fair, you know, I get income and they're paying lower taxes.

Look, this is a, you know, that is an issue perhaps amongst billionaires who live globally or some circumstances.

But the end of the day, if capital gains tax starts heading north of 20%, people hold, they don't sell that.

It's an asset, it is different from income.

You have to understand the accounting, you have to understand the tax, the reality of what these, these things have.

So what you really want counterintuitive is to get entrepreneurs thriving.

And I was pleased to hear Andy seems to get something that dear old Kieran Rachel didn't get.

It's, it's all about the SME in this country.

We only have a, you know, 8,000 large companies with more than 250 staff.

We have 5.5 million with less.

You've got SMEs left, right and center struggling to hell.

You need to cut that national insurance thing back down.

That will help them employ more people.

You need to encourage them maybe with lower corporation tax.

You need to look at business rates, you need to look at all these things and free up the SME to grow to and bring back entrepreneurs really.

So people are again coming from overseas to build their businesses.

Australians are turning up again wanting to employ, drive businesses and then that all becomes really interesting.

The other thing you could really look at is vat.

And I think unfortunately, because he's probably not going to go for a general election, he's not going to be able to do the red lines.

And if I was to put the capacity, if I was to talk to you about tax.

The red lines of the labor government that we're not going to touch any of these taxes and we're only going to touch these taxes.

Taxes.

The taxes they've chose represent all the minor taxes, the taxes that don't really matter.

VAT matters, income tax matters, corporation tax matters, you know, there's not that they matter, but they're so small.

So it's a bit like saying, I'm going to make a cake and I'm going to only make a cake out of icing, is what we're trying to do at the moment.

And yeah, you could do that, it'd be a pretty rubbish cake.

But that's what we're talking about.

Literally the icing of taxation is we're trying to sort of use as like, we're going to raise 60 billion.

It's like, oh, you're not.

Not without, like driving everywhere.

There's only so far you can turn these things.

Basically trying to raise the taxes through.

Through the backdoor, like through taxing businesses more.

Yeah.

Ultimately what that does is it stops those businesses either investing in the country or hiring people.

Yes.

100 People want.

People want to.

People want to harm more and drive more.

They've.

They've seen businesses, these big fat cats, they can just leverage money off.

Even the bankers have been coming out, JP Morgan saying, don't piss us off, you know, we'll go somewhere else.

And this fluidity of this sort of very talented community, which is illustrated when you talk about FDI as well.

You talk about people like, well, we don't want more foreign businesses coming here.

It's like you do.

It will create and drive, you know, we want the best business people from around the world coming to the UK because it's the best place to do business.

Driving, building businesses.

And look, I respect the patriotic millionaires that there's this group of people who are very British, Gary Lineker, Gary, whatever.

They're not going anywhere.

I'm not going anywhere and I don't even have any wealth.

But it's like, you know, great, there's a group that won't go.

But that's so misunderstanding the point about how many people aren't so connected to the UK who didn't play football for England and are just absolutely got, you know, Union Jack underpants on the whole time.

You know, there are a hell of a lot of these millionaires and billionaires who have quite a loose relationship with the uk, who can.

Can change their.

Change their lives a little bit and then you're losing all of that.

But yeah, more than anything, let's just say you're British, let's say you've got a British business.

They are struggling, they are being taxed to hell.

You know, as James Sinclair would say, turnover taxes, it's like bring those down, start really allowing the SME to fire.

There will be a short term issue, perhaps that you'll collect slightly less revenue, but then it's just going to go,.

You know, I mean, Anthony, I do think so.

Andy has said that he's not ruling out tax increases on those areas that labor had previously said that they weren't going to increase taxes on.

So I think, you know, and he might cut sdlt.

I think it's going to be interesting.

He gets it better.

The SME bits better and let's see.

What happens in the budget.

We will be here, we will do a special podcast, I'm sure.

But the problem is balancing the books, unfortunately the problem is balancing the books.

But if you can make a plan that you're going to say, we're going to do these things, things, and the trouble is we don't have certainty.

We've got another two, three years, we've got an election.

But if you did a very pro business budget, the reality is you're either going to stay in or we're going to get the Conservatives reform.

For all of their faults and everything, you were going to have a very pro business budget too.

So I think you could go on a graph that over the next five years, businesses start really firing up again, feeling fantastic, growth picks up, investment into the country.

I mean, you can see all of that, right?

And they can, they can rave about it.

And that's how you solve inequality.

Surely it's the only way is in, like you have to have so many job opportunities, whatever.

I think also apprenticeship schemes, all of this stuff's coming.

There's such a shift now, you know, in training and everything.

Well, for graduates.

So many of them are struggling to get jobs now because of AI.

So I mean, that's a whole other topic that we won't go into.

But they need to really make sure that there is a job, there are jobs, like good jobs for all of those graduates.

I hope to less go to you.

I think this already happened.

And the smart ones don't go to university, don't rack up a debt in university, get, get on with your lives, start building businesses, start getting out there.

That can't be replicated by AI.

Yeah, yeah, yeah.

There's a few of those things, tires.

I was thinking the other day, I've got to get my dad, my, my wife's pop tar in the car.

And I was like, that's a great business.

That's a great business.

Anyway, obviously Andy Burnham just became Prime Minister on Monday so we're recording this on Thursday.

The that was just three days ago.

These are just our questions to him.

There is so much that's going to be uncovered.

We're very excited actually to see what he is going to do.

We think, I think he has great potential.

This was just a, should we say emergency podcast.

Are we that important?

I don't know.

This is just a one off episode to kind of go through those kind of questions and we will be back soon with like a proper podcast.

So this was business without BS with me, Gemma and Andy.

Thanks for joining us.

Thanks.