Prime Minister Andy Burnham has promised to be on the side of the pubs, shops and small businesses he says Westminster has left behind.
The former Mayor of Greater Manchester from May 2017 – June 2026 became the UK’s seventh prime minister in a decade on Monday, replacing Keir Starmer, who was forced out by his own party after a run of election defeats.
In his first speech outside 10 Downing Street on 20 July, he called the moment a “circuit breaker for Britain, bringing forward the biggest changes in the last 40 years: a new political model and a new economic model.”
For the UK’s 5.7 million SMEs, some of his early pledges – including mention of a 10-year plan for the country and a plan to reindustrialise Britain – will be met with trepidation in the face of rising costs and enduring concerns following the 2025 Budget. Jerry Riches, associate director at Business Finance Trust, which advises small businesses on funding and cashflow, hears that scepticism from clients directly.
Speaking to Employment Hero’s UK Newsroom, he said: “They’ve heard that message for two years while being hit from all angles. Actions speak louder than words.”
A Period of Hardship for SMEs
In the past few years alone, businesses have had to contend with economic shocks, a slew of measures under the Employment Rights Act, rising NIC costs and geopolitical complications that have increased costs and impacted employment and wage growth.
In May, a YouGov survey for Employment Hero of 1,000 business leaders found that more than half of businesses (56%) said employing staff has become more complex over the past 12 months, with nearly a fifth (19%) describing it as “much more complex”. Those who believed things had become easier came in at just 2%. The introduction of Employment Rights Act measures also created widespread concern, with over half of businesses (53%) saying they were worried about unintentionally breaching new employment laws.
Bill Robertson, founder of the reward consultancy EasyGrading and a chartered fellow of the CIPD, highlights similar doubts around Burnham’s promises – particularly in response to Burnham’s pledge to review the rise in employers’ National Insurance contributions, as announced during the Makerfield byelection campaign in June. The problem, Bill told Employment Hero, is consistency.
“If we look at the criticisms in the past, it’s been about: can we believe what they say? Do they really back up the words with actions? It’s a record of announcements that never turn into anything,” he says.
Burnham’s central pitch to shift power and growth out of London and into the places that have been overlooked has support among the SME employers now watching him. But Kevin Fitzgerald, UK managing director at Employment Hero, says the regional case is at risk of falling short without action on the cost of hiring:
“As Andy Burnham steps into the role of Prime Minister, there has already been much said for what his Manchesterism brand of politics might mean for businesses and workers across the UK,” he says adding:
“The argument that economic growth lies in cities and communities across the UK, and not just in the capital, is a good one. Our data shows employment growth in the North is outpacing even that of London, but employers are being hit harder by rising employment costs and complexity, which has more of an impact on regional businesses and therefore has a knock on effect on wages.
“If the vision for Manchesterism is regional growth driven by the regions, then we must look at national policies which make hiring and growth complex for SMEs. Increasing businesses’ abilities to be ambitious and make hiring decisions will ultimately support SMEs up and down the country to drive employment growth within their communities.”
UK Business Energy Prices Top the List of SME Demands
Energy is another area where SME owners want the new Government to move first. Burnham has already named it as a problem, floating the idea of bringing water, energy and transport under greater public control to bring bills down over time.
Some business groups want him to go faster, however. A joint report from the CBI and Energy UK released in July 2026 found UK electricity prices run around 50% higher than the G7 median, with four in 10 companies cutting investment as a result, and urged the incoming prime minister to treat business energy costs as a day-one priority.
For Business Finance Trust’s Jerry, the pressure runs across sectors. Energy costs hit manufacturers and hospitality alike, he says, from heating premises through to the laundry bills that weigh on hotels, and they feed through to brewers and food producers who are already absorbing a new packaging tax.
“When those costs stack up,” Jerry says, “staff hours or number are cut, recruitment and investment halted.”
Business Rates and National Insurance Contributions Come Under Scrutiny
Beyond energy, SME owners want the structure of business taxation rethought. Burnham has signalled an overhaul of business rates that would raise levies on out-of-town warehouses to fund cuts for high-street shops and pubs, and he has talked about rewarding businesses that bring social value to a place.
In a year in which young employees have been under the spotlight due to higher competition and lower wages in the job market, the new Prime Minister also said his Government would “help more young people into work by changing the education system and giving them more support, more mental health support”, support the hospitality industry in particular desperately needs beyond the youth jobs support packages announced under Keir Starmer.
For the businesses Jerry advises, however, that does not quite go far enough. He wants the burden shifted away from taxes a company pays simply to exist, business rates, National Insurance and energy, and onto what it earns. “Corporation tax applies to profitable businesses,” he says. “Energy, NIC and rates are a cost on all businesses and increase the rate of business failures.” Taxing a business for existing, in his view, is the wrong model, and the priority should be supporting owners and the people they employ in order to save them from potential closure.
Bill draws the same line between tax and growth. Push the tax burden too far, he says, and it stops paying for itself. “It’s all very well to tax, but eventually that’s a self-defeating prophecy. You really have got to generate revenue, generate growth.” Improve the economy’s performance, he argues, and “everybody benefits.”
Burnham’s plans – and how useful they are for SMEs – will become clearer in the coming months. Whether they redress energy costs, business rates and NIC bills at the heart of many SME concerns, will determine whether the businesses he says he’s fighting for begin to feel heard.
