A lack of commercial understanding inside government is making it harder for companies to operate and is actively holding back economic growth, according to the boss of Iceland.
Richard Walker, executive chairman of the frozen food retailer and a newly appointed Labour peer, has warned that too many politicians fail to grasp how businesses actually function — particularly those operating on tight margins and employing thousands of people across the country.
“I’ve met a lot of MPs over the years,” Walker said. “Very few understand how a business actually runs. There’s still a mindset in parts of government that treats profit like a dirty word, when profit is precisely what allows businesses to invest, employ people and pay tax.”
Walker argued that political suspicion of profit misunderstands how sustainable growth is created. For large employers such as Iceland — which operates in every region of the UK — margins are slim and policy decisions can have immediate, real-world consequences.
“Without profit, you don’t have reinvestment. You don’t have job security. And you certainly don’t have tax receipts,” he said. “Yet too often policy is designed as if businesses are somehow the enemy, rather than the engine.”
While he acknowledged that some politicians are genuinely willing to learn, Walker said too many engage superficially.
“The best ones visit stores, talk to staff and understand the reality on the ground,” he said. “But too many just want a photo opportunity and then disappear.”
Walker’s criticism extended beyond individual ministers to what he described as a structural problem across Whitehall, where departments pursue conflicting agendas with little coordination.
“From business rates to energy policy to food regulation, it’s a mess,” he said. “Defra is saying one thing about sustainability, the Treasury is saying another about taxation, and local councils are all doing their own thing. There’s no joined-up thinking, and businesses are the ones left trying to make it work.”
He said this lack of coherence disproportionately harms employers with national footprints, who must navigate different rules, costs and enforcement approaches depending on postcode.
Walker is due to take his seat in the House of Lords this month, marking a notable political shift. Both he and his father, Iceland founder Sir Malcolm Walker, previously supported the Conservatives, with Walker donating to the party and briefly appearing on its approved candidates list.
However, his relationship with the Conservatives cooled after a disagreement with former prime minister Rishi Sunak, prompting a reassessment of where he felt his voice could be most effective.
“I realised pretty quickly I’d be useless at toeing the party line,” Walker said. “I tend to say what I actually think, which isn’t always compatible with frontline politics.”
Earlier this year, he rated Sir Keir Starmer’s government six out of ten, urging Labour to prioritise what he called “inclusive, everyday growth” rather than headline-grabbing projects.
Walker said the government’s obsession with mega-projects risked missing what really matters to businesses and communities.
“It’s not about HS2 or a third runway at Heathrow, projects that may never happen, certainly not in my lifetime,” he said. “It’s about the cancelled bus route, crime on the high street, the loss of civic pride, the litter, the crumbling town hall.”
For Walker, restoring growth means focusing on the fundamentals that affect ordinary businesses and workers every day.
“That’s where trust is built,” he said. “The politics of the everyday. The politics of the ordinary. Get that right, and growth will follow.”
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Political ignorance of business is stunting UK growth, warns Iceland boss