John Healey attempted to ease business nerves over the Budget today insisting he wants to cut their costs and reward ‘profit’. 

The Chancellor went out of his way to deliver a pro-enterprise message in an interview, with less than a week to go until the crucial fiscal package.

But one high street boss said retailers would be ‘choking on our cornflakes’ at the remarks, describing Labour’s first two years in power as ‘horrific’ and ‘pretty brutal’. 

And the head of Sainsbury’s warned it is essential ‘we don’t see a repeat’ of the previous assaults on companies. 

Fears have been running high over how Mr Healey will attempt to balance the books amid the fallout from the Middle East crisis. Banks are thought to be in the firing line for a raid to bring in more revenue.

In an interview with The Times, the Chancellor said he was ‘conscious’ businesses were suffering from the cost-of-living crisis as well as households.

‘I want to be a chancellor who backs business in Britain making a profit, and those entrepreneurs who, in the end, are the ones who challenge the status quo, come up with innovative ideas and are trying, some of them through sheer bloody-mindedness, to keep going through these sorts of pressures,’ he said.

John Healey went out of his way to deliver a pro-enterprise message in an interview, with less than a week to go until the Budget

Mr Healey also acknowledged firms had been under ‘a lot of pressure’ in recent years – although he defended Rachel Reeves’ massive increase of national insurance contributions.

He continued: ‘When I talk about the cost of business, and recognising that in the same way as we’re recognising the cost of living pressures, I’m conscious of that as I go into the budget for both businesses and households.’

Mr Healey has signalled that capital gains tax rates will not increase, in a bid to cool concerns about an attack on entrepreneurs.

He also hinted yesterday that there will be some ‘breathing space’ for Brits struggling to cope with soaring energy bills. 

Consumer champion Martin Lewis has said he expects the Warm Homes Discount – only available to benefits claimants – to be doubled from £150. 

Andy Burnham made a vague suggestion at PMQs that he wanted to remove standing charges from gas bills, although if the costs are simply moved to unit prices then higher users could end up being worse off. 

The grim backdrop to the Budget was underlined yesterday as official figures showed the UK’s debt mountain has hit the grim milestone of £3trillion.

The mark was reached following higher-than-expected public sector borrowing last month reaching £24.5billion.

Meanwhile, inflation surged above predictions to reach 3.5 per cent in the year to September. 

Analysts said the price pressure is likely to guarantee that the Bank of England will increase interest rates next month, heaping pain on mortgage-payers. Some are now anticipating another rise in December.

Economists have suggested that Mr Healey could be helped by a windfall from higher inflation, which will drag people deeper into the tax system due to thresholds being frozen until 2031. 

While that would help offset higher debt interest costs, it will also leave families worse off and put intense strain on public services unless departmental funding also rises.

Simon Roberts, chief executive of the UK’s second largest supermarket chain Sainsbury’s, has said he believes the current Government is ‘listening’.

But he cautioned there can be no more significant increases to business taxes and labour costs.

‘I think this Government is listening to business,’ he said.

‘We’ve had the opportunity to meet with figures from Government and stress that it is really important we don’t see a repeat from previous budgets.’

Andrew Murphy, boss of toy retailer The Entertainer, said the high street was still facing significant challenges.

Asked on BBC Radio 4’s Today programme what he thought of Mr Healey’s latest comments, Mr Murphy said: ‘Once we’ve finished choking on our cornflakes, it’s extraordinarily welcome if it turns into decisive action.

‘Just to put this all in context the OECD’s tax and wages study this year found that the UK had the largest rise in the tax burden on labour of any OECD country… 16 times the OECD average.

‘It really has been a horrific couple of years for not just business and business entrepreneurs, but those that they would seek to employ.’

Mr Murphy was asked whether it would be enough if Mr Healey only cut regulation at the Budget.  

‘He doesn’t have a lot of money to play with, and we all accept that, but if it’s just tinkering around the edges it’s not going to make a decisive difference,’ the business chief said. 

‘We need the employer national insurance threshold to move back up so we can employ more people on eight and 12 hour contracts – typically students, young people, where we know we’ve got a youth unemployment problem.

‘And we need business rates to change as well.’

Mr Murphy said if Mr Healey held off from taking any major measures next Wednesday that would be ‘better than two pretty brutal years previously’.