New Year, new job for Lord Bilimoria, who came to the UK from India as a teenager, started the Cobra beer empire from a flat in Fulham in his 20s and rose to the top of the business establishment.
On January 1, Karan Bilimoria became UK chair of the International Chambers of Commerce (ICC) – at a crucial time when Donald Trump threatens to impose tariffs and blow apart the free trade ideology that has prevailed for decades.
But Bilimoria also has his work cut out closer to home, where he says Labour’s tax rises are stifling enterprise and Ministers are refusing to listen to business.
Have Rachel Reeves and Keir Starmer, after courting businesspeople ahead of the Election, now betrayed them?
‘I feel – business feels – with this Labour Government, let down. We are disappointed. And we feel we are not being listened to, most of all,’ he says. ‘As president of the CBI I saw the power of Government and business working together.
‘I am pleading with them – please work with us. Then we can grow the economy. The latest data shows we are not doing that. We may be heading for a recession.’
Frustrated: Bilimoria says Labour has upset pensioners, farmers, family firms and every major employer
Bilimoria, 63, knows the Chancellor and Prime Minister, having dealt with them regularly at the Confederation of British Industry between 2020 and last summer.
‘I found them very decent, well-meaning individuals who said they wanted to champion business and entrepreneurship. But I’m sorry to say they have been in Government since July, and what is happening? They started off upsetting pensioners, then they upset farmers, then they have upset family businesses, then they have upset every employer by putting up National Insurance.
‘Then you have employment regulations coming in at a cost of about £5 billion that is going to make us less competitive. It is one thing after another.
‘I am sorry to say a lot of blame goes to the previous government, Rishi Sunak in particular. When he was Chancellor, I kept saying to him ‘do not put up taxes’. If you do you will stifle the recovery. What does he do? He goes and puts up corporation tax from 19 to 25 per cent – a huge mistake.’
However, Labour, he says, is ‘making it worse’. He has little patience with Reeves’ claims she was forced to put up taxes because of a £22 billion-a-year black hole in the public finances that she says was left by the Conservatives.
‘The black hole – don’t get me started on the black hole please. Put it in the context of an economy that is £2.7trillion a year and you are blaming everything on £22 billion and using it as an excuse?’
Bilimoria came to the UK from India to study at the age of 19, and set up Cobra in that South-West London flat in 1990 with £20,000 of debt. He says: ‘I had that dream and I am proud to have created a household brand.’ Recently he stepped down from the firm, whose beer is a staple in curry houses up and down the UK.
‘To think everyone in every corner of the country knows Cobra –that is amazing. We all love going to Indian restaurants. It is part of our way of life,’ he says. But do Labour’s changes to inheritance tax threaten curry houses, most of which are family concerns?
They are, he says, ‘very damaging to any family business’, though curry houses ‘somehow survive’ everything thrown at them. ‘But we should not put them in that position. We should be celebrating them not hindering them.’
In the 1980s, when he arrived in the UK, entrepreneurship was ‘not at all celebrated’, he says. ‘It was seen as something for second-hand car salesmen and Del Boys.’
He credits Margaret Thatcher for making it socially acceptable.
Interestingly, though, he says the Blair-Brown government was the most business-friendly one, citing capital gains tax relief for entrepreneurs, which makes his criticism of the current Labour administration the more telling.
His rise to the top has not been plain sailing. Cobra over-extended itself and in the 2009 crisis went into a ‘pre-pack administration’.
Bilimoria bought back the business in a joint venture with North American brewer Molson Coors.
This type of deal has had bad publicity for enabling entrepreneurs to slough off their debts.
Bilimoria says he has settled with 99 per cent of creditors, the rest being owed such small sums it is impractical to try to repay them. Bilimoria was given a life peerage in 2006 and is a cross-bencher in the House of Lords and was the first person from an ethnic minority to be president of the CBI.
The sex and drugs scandal at the CBI in 2023 ‘was awful’, he says, adding: ‘Luckily I was still on the board, so I could help try to save the organisation. The CBI is back up and running. There is a little bit to go, but it is almost there.’
His excitement over his new job at the ICC is evident.
‘It is the biggest business organisation in the world, representing five million businesses, employing a billion people in 70 countries,’ he says, rattling off the statistics. ‘We are the only business body with a seat at the United Nations and at the World Trade Organisation.
‘I am going to be in this role with Donald Trump as president, so there will be lots of very interesting issues around trade coming up and tariffs on top of that.’
What would be on his New Year wish list? Reforming business rates, which in the UK are, he says, the highest in Europe. He adds: ‘I would raise our investment in research and development and innovation. We invest 1.7 per cent of GDP compared with America at 3.2 per cent.’
He would give firms incentives and help to export, and put in place ‘a clear industrial strategy’.
Firmly in the anti-Brexit camp, he says ‘businesses would benefit from a much closer working relationship with the European Union’.
Reducing corporation tax, which was raised by the Conservatives, is another move he would make.
‘This Government had a 170-seat majority so they had the opportunity to be bold and cut tax, so long as they did it in a sensible way – not the Liz Truss way – but doing it in hand with business.
‘You cannot create growth by putting up taxes and creating an environment that doesn’t attract investment. It is private sector growth that creates the jobs that pay the taxes to fund the public sector. If you kill the goose that lays the golden egg, that’s it.’
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