The Government’s “anti-growth” policies are taking Britain back to the 1970s, luxury hotelier Sir Rocco Forte has warned.
Sir Rocco, whose business owns the Balmoral Hotel in Edinburgh and Brown’s in London, said ideas “based on socialism” were driving away investment and wealth, threatening to derail the country’s current strong growth.
“We’re going back to the ’70s, effectively,” he said. “We’ve come full circle, which is very irritating, and all the good work that Thatcher put in, created a very good climate, has been disfigured over the last 20 years by both the Blair-Brown governments and ... Conservative governments.
“Now we’ve got a Labour Government, which is doing a lot based on socialism, but not a lot on common sense. They talk about growth, but everything they’re doing is anti-growth.”
Sir Rocco said he was concerned that the “Government is about to bring in very anti-business legislation” such as tax rises in the Budget and a strengthening of workers’ rights that critics have warned will put companies off hiring.
The possibility of a tax raid has “already started to spook a lot of people in the City”, he said. “It’s starting to create an exodus of wealthy people and the beginnings of a brain drain.”
Speculation about a wealth tax is also mounting, which the tycoon said will “make life really difficult for some people” since assets owned by the super-rich are “not necessarily income-producing”.
Referencing Sir Keir Starmer’s declaration last month that “the broadest shoulders should bear the heavier burden”, Sir Rocco said: “We’re going to support the working man, whatever that means.
“No party today is supporting the working man. Freeing up unions and giving them more power isn’t going to help the working man, it’s going to help the unions and damage the country.”
The entrepreneur, 79, fears Britain is close to returning to the economic bleakness of the 1970s. The decade was defined by stagnant growth and high inflation, widespread strike action and an energy crisis that prompted the government to introduce a three-day week.
London in the 1970s was “dead”, Sir Rocco said, warning: “That could easily happen again if they’re not careful.”
“Effectively, the Conservatives brought us back to the ’70s, more or less, and this lot will finish the job.”
He fears Britain will become an “inward-looking” place with “a lot of unions running rife”, rather than an “enterprise economy about growth”.
While Sir Rocco noted that the economy is currently outperforming rivals in Europe, such as France, Italy and Germany, he is concerned that Chancellor Rachel Reeves’s upcoming Budget could tip the balance.
He cited the Government’s plans to increase a windfall tax on North Sea oil and gas producers as an example of anti-growth policies. The change will take the effective tax rate on operators to 78pc and companies claim the move will cost the economy £12bn in tax receipts and put at least 35,000 jobs at risk. “It’s crazy,” Sir Rocco said.
The hotelier said he was also concerned about Deputy Prime Minister Angela Rayner’s plans to overhaul workers’ rights, including making it easier for workers to claim four-day working weeks.
“If employers wanted to do it, they could do it now,” he said, adding that he looked at it for his own business but concluded it would be too expensive to implement.
Son of the late hotelier Charles Forte, Sir Rocco created Rocco Forte Hotels with his sister Olga Polizzi. Its first two hotels opened in 1998 and the group now has 15 luxury venues, with five more under development. Revenues in the year ending April totalled £312m and the company made a profit of £15.8m.
The Saudi Arabia ‘revolution’
Last December, Sir Rocco oversaw the sale of a 49pc stake in the group to Saudi Arabia’s Public Investment Fund (PIF), valuing the business at around £1.4bn.
PIF is Saudi Arabia’s sovereign wealth fund, led by Crown Prince Mohammed bin Salman. It counts Newcastle United FC, Heathrow and Aston Martin among its investments and is constructing a futuristic city in the desert called Neom as part of efforts to diversify the Saudi economy away from oil.
However, the fund has proved controversial, given Saudi Arabia’s human rights record. Amnesty International has raised concerns about freedom of expression in the country, alleged unfair trials, death sentences, claimed human rights abuses against migrants and discrimination against women.
Sir Rocco insisted that Saudi Arabia under the Crown Prince was a modernising force in the region.
“They are a benign influence on the Middle East,” he said. “I see no reason not to deal with them at all.
“The current regime has created a sort of revolution in Saudi Arabia. It’s amazing what is going on there and the developments taking place, and the overall liberalisation of the economy to a great degree.”
With PIF’s support, Rocco Forte Hotels plans to double the amount it is spending on revamping its hotels to €40m (£34m). Refurbishment projects include London’s Brown’s Hotel, the Hotel de Russie in Rome, Verdura Resort in Sicily and The Charles in Munich. It is also developing five new hotels in Italy.
The PIF investment has also raised the company’s profile around the world and boosted its appeal to prospective partners, Sir Rocco said.
The team is in the process of signing a deal in Dubai and is scoping out sites in Saudi Arabia and Marrakesh. In the US, locations such as New York, Palm Beach, Miami Beach and Los Angeles are on the wish list. Around 45pc of the group’s business already comes from the US.
‘Britain needs a visionary leader’
Back in Britain, Sir Rocco, a Brexit supporter, is keeping a close eye on the Tory leadership competition. He helped fund Boris Johnson’s 2019 election win and threw him a victory party but has become disillusioned with the party in the years since.
He has said Britain needs a “visionary” leader to fix its problems but told The Telegraph: “I don’t know if that person is around yet.”
If there is a glimmer of potential among the Tory leadership hopefuls, he argues that it is Kemi Badenoch, the shadow communities secretary.
He said she was the “only one who really understands the depth of what needs to be done”. Sir Rocco cited a speech in which she called upon ministers to “take back powers” handed to organisations that “run large parts of the country, with a lot of power and little accountability”.
The leadership race is a chance for the Conservatives to reset by moving Rightwards, he said.
“What we’ve seen over the past 14 years is a centrist approach, which has always moved further to the Left.
“We haven’t had Conservative governments that wanted to change anything. [That was] very much started by [David] Cameron and [George] Osborne, their idea of triangulation and the centre-ground, and following the polls rather than leading.
“If the Conservative Party lets [in] a leader who wants to do that, that’s the end of the Conservative Party. I’d jump on to the Reform bandwagon straight away.”
He added: “The only way to deal with Reform is by moving to the Right. This idea that we have to govern from centre-ground is rubbish. Thatcher never did, and she had policies which were communicated well and people believed in her.”
‘A question of energy and ambition’
While he still has a house in Surrey, Sir Rocco spends most of his time in Rome these days, making fewer visits to the UK. The Government’s plans will influence whether that changes.
“I’d like to see how things pan out in the next six months before I start saying that I want to invest heavily into the UK. We’ll have to see the details of what the Budget brings, but I think professional people are going to be very hard hit.”
Sir Rocco’s son Charles, 32, is director of development at his company, while daughters Lydia, 37, and Irene, 35, also both work in the business. The business also has a “very strong executive team”, Sir Rocco said.
Succession plans are in their “early days”.
“It’s not a thing I don’t think about; of course I think about it, and I have some ideas that may well emerge in the next year or so.”
For now though, retirement plans remain a distant thought.
“It’s a question of energy and ambition,” said Sir Rocco. “At the moment, I have the energy and I have ambition.”
Disclaimer: The copyright of this article belongs to the original author. Reposting this article is solely for the purpose of information dissemination and does not constitute any investment advice. If there is any infringement, please contact us immediately. We will make corrections or deletions as necessary. Thank you.
