Why Andy Burnham Is Completely Wrong About Business Rip Offs And Cost Of Living

Politicians love a villain. Andy Burnham has found his latest convenient target in the supposed army of corporate predators exploiting consumers with rip-off business practices. The narrative plays well on the evening news. Big business jacks up prices, the working family pays the price, and a crusading mayor steps in to protect the public from predatory margins. It is a neat, emotionally satisfying script.

It is also complete economic nonsense.

I have spent two decades watching companies try to navigate margin compression, inflationary spikes, and regulatory compliance. I have seen mid-sized firms blow millions trying to absorb government-mandated cost increases only to collapse into liquidation within six months. The lazy consensus gripping regional administration is that high prices are a moral failure of greedy operators. Prices are a math problem. When you attack the symptom while weaponizing the regulatory apparatus, you accelerate the exact pain you claim to solve.

Let us dismantle the populist fiction that price tags are set by malice rather than market gravity.

The Margin Illusion That Politicians Refuse To Understand

When an official targets hidden fees, subscription traps, or dynamic pricing models, they pretend these mechanisms exist in a vacuum of pure greed. They do not. Modern commerce operates on razor-thin margins across supply chains bruised by years of systemic disruption.

Take the hospitality and retail sectors frequently hauled over the coals for add-on charges or administrative fees. Politicians point to a booking fee or a tiered service charge and call it a rip-off. They ignore the baseline economics. Labor costs have skyrocketed. Business rates punish physical storefronts. Energy overheads have transformed utility bills from an operational expense into a primary threat to survival.

When a business introduces a separate fee structure, it is often an act of survival, not predatory enrichment. They are trying to keep the headline price visible and competitive while recovering the real costs of delivery.

Imagine a scenario where a local restaurant removes all mandatory service charges, administrative fees, and delivery markups to satisfy a local government crackdown. To survive the mandated wage floors and energy taxes, that same restaurant must immediately inflate the base price of every meal on the menu by twenty five percent.

The total cost to the consumer remains identical. The only thing that changes is the transparency. By forcing businesses to bundle every single regulatory burden into a flat fee, politicians destroy price clarity and penalize the frugal consumer who uses fewer resources.

The Regulatory Tax On The Working Class

Every time a municipal authority promises a crackdown on business practices, they introduce a new layer of compliance overhead. Compliance is not free. It requires legal oversight, operational overhauls, and software adjustments.

Who pays for this? The consumer. Always.

Small and medium enterprises cannot absorb compliance shocks the way multinational conglomerates can. When you pile regulations onto independent operators under the guise of protecting affordability, you crush market competition. You force out the independent coffee shop, the local gym, and the regional service provider.

What happens when the independents die? Consolidation.

Monopolies and oligopolies love heavy-handed municipal intervention because they can weaponize compliance as a moat against new entrants. By cheering on a regulatory crackdown, regional leaders are actively engineering the very corporate consolidation that drives long-term price inflation.

The Wrong Diagnosis Of The Cost Of Living Crisis

The core premise of the anti-rip-off crusade is that high prices cause cost of living pressures. This puts the cart before the horse with impressive geometric precision.

Prices are a thermometer, not the fever.

The fever is structural monetary devaluation, suppressed productivity, constrained energy supplies, and an endless compounding of administrative drag imposed by the state itself. When governments print currency, inflate debt, and mandate expensive green transitions without building baseline capacity, the currency buys less.

Blaming a gym membership cancellation fee for a family budget squeeze is like blaming the speedometer for speeding.

Let us look at the data on corporate net margins outside of a few outlier tech giants. The average high street retailer or service business operates on a net profit margin hovering between four and seven percent. If every single business in that sector instantly slashed their profit margins to zero, the average household would see a negligible blip in their monthly outgoings.

Why? Because the money isn't pooling in corporate excess. It is bleeding out through taxes, rents, energy grids, and supply chain friction.

Stop Fixing Symptoms And Destroying Markets

If leaders genuinely want to ease the cost of living, they need to stop staging performative crackdowns on consumer-facing businesses and start dismantling their own roadblocks.

• Abolish regressive business rates: Stop taxing physical square footage that keeps high streets alive and vibrant.
• Cut compliance red tape: Let small businesses compete without hiring an army of consultants just to fill out municipal paperwork.
• Fix energy policy: Address the structural grid failures that make powering a shop or a factory twice as expensive as it should be.

As long as politicians treat business operations as an infinite piggy bank for political posturing, prices will stay high, margins will stay strained, and the consumer will keep paying the bill.

Burnham can keep tilting at windmills and scoring easy headlines about rip-off practices. But while the speeches play on the news, the real economy quietly bleeds out from the solutions of the people who claim to save it.