Mike Ashley slams Burnham's 'populist' high street plans and business rates policy

Billionaire Mike Ashley has blasted Labour leader Andy Burnham’s recent cost‑of‑living and high‑street initiatives as “populist reactions”, warning that the government’s “disastrous” business‑rates policy and rising employment costs are crushing small businesses. In a letter to the prime minister, the Sports Direct founder accused Burnham of “jumping on everyday fixes or bandwagons” and called proposals such as raising business rates on large warehouses to subsidise pubs and clubs “delusional”.

The letter, first reported by the Financial Times and seen by the BBC, was sent to the prime minister ahead of the first Budget, scheduled for 27 October. Ashley urged that the Budget be used to lower costs for employers and to change the government’s stance on business rates. He said that the current policy environment, which he has criticised for years, is driving businesses into “a state of struggle”.

Burnham’s plans, announced earlier this month, aim to revive Britain’s “hollowed‑out” high streets. The chief secretary for the Northern Ireland Office has promised a new economy that backs British business, delivers growth in every postcode, and makes essentials such as energy, water and housing affordable again. Among the measures to be introduced are a 20 % cut in business rates for pubs, social clubs and live‑music venues from April, a review of how business rates are calculated, and a cut in VAT on household electricity bills. Burnham has also pledged to block new vaping and betting shops in councils, end “subscription traps”, and ban misleading recommended retail prices that exaggerate discounts.

Ashley’s criticism is rooted in his own experience of the high‑street sector. He built Frasers Group from a single Sports Direct store in Maidenhead in 1982 into an empire of dozens of brands employing 30,000 people. The billionaire has faced repeated accusations of exploiting workers, including a 2016 admission to MPs that staff at his Derbyshire warehouse had been paid below the minimum wage and fined for lateness.

In the letter, Ashley questioned how Burnham intends to revive Harvey Nichols, the luxury department store the Ashley Group bought last month and has promised to restructure. He echoed comments by Tory peer and former Marks & Spencer chief, Lord Rose, who described the government’s announcements as “hot air”. Ashley said, “I agree with him.” He also warned that the high‑street would be “further devastated” without major reforms and that Burnham’s suggestion of future business‑rates changes in the Budget is “too little, too late”.

The letter also tackled Burnham’s plan to curb the use of recommended retail prices. Ashley argued that the real issue is “price fixing in sporting goods and other markets”, citing the rising cost of official football merchandise. He added that “the disastrous business‑rates position (which I have raised many times over the years) and the dramatically increasing cost of employing people are really causing business to struggle.”

Downing Street responded that Burnham would “build a new economy that backs British business, delivers growth in every postcode and ensures the essentials in life – like energy, water and housing – are affordable again.” The spokesperson said that the promises of cutting VAT on household electricity bills and reducing business rates for some firms are “just the start”.

Ashley’s letter highlights a broader debate over how the UK government should support the high‑street economy. While Labour’s proposals focus on easing rates for hospitality venues and regulating pricing practices, the billionaire argues for a fundamental overhaul of the tax system, including leveling the playing field between high‑street retailers and online rivals. He warns that “if your answer is to tax larger retailers even more, through hiking business rates on retailer‑owned or third‑party warehouses whilst reducing rates for pubs and clubs, then that is simply delusional.”

The Budget will likely address these tensions, but Ashley’s criticism underscores the urgency of finding a balanced approach that supports both traditional high‑street businesses and the changing retail landscape.