Billionaire John Caudwell has said he was “misled” by Keir Starmer’s Labour Party and revealed that he hopes to once again back the Tories at the next election.

The entrepreneur and philanthropist said there is “no chance” of him voting Labour at the next election, which he says the government is bound to lose.

Labour attempted to charm the business community ahead of the 2024 general election, promising at the time to be “the most pro-business government this country has ever seen.” Since then, a raft of tax increases and new red tape has frustrated many of Britain’s private sector leaders.

Caudwell had previously backed the Conservatives and donated £500k to the party when it was led by Boris Johnson.

But the billionaire switched allegiances to Labour ahead of the 2024 election, believing Starmer’s party would grow the economy – though he now concedes “they’ve not done that at all.”

Labour ‘will lose next election’

Caudwell now says he feels he was “misled” by Labour’s pro-business agenda, which he claims has been scuppered by policies including the hike to minimum wages and the end of the non-dom regime.

“I was misled. I don’t know whether it was deliberately misleading, I’m not going to accuse them of deliberately misleading me or the rest of business, but I was misled because they’ve not done what they said they were going to do,” he told City AM.

“Before the election, they sounded like the Tory party on steroids. It was just growth, growth, growth,” he added.

The billionaire said Labour has pursued “misguided” policies. “I don’t see that Labour are going to change course. I think without doubt with everything that they’ve done now they’re going to lose the next election,” he said.

“Labour has really not delivered what they said they were going to do, and it’s going to be a disaster for the long term future of Britain,” he added.

Caudwell said he will not vote for Labour again at the next election: “Based on what I’ve seen up to yet, there is no chance, no chance at all. They’ve let me down massively.”

Sir Keir Starmer’s position as Prime Minister was thrown into doubt following heavy Labour losses at the local elections, and Manchester Mayor Andy Burnham and former health secretary Wes Streeting are circling for a potential leadership contest.

But Caudwell said the alternatives on offer within the Labour party are “more of the same”.

“I think Wes Streeting is a very personable guy, but we need another radical change, I’m afraid,” he added. 

Caudwell could donate to Tories again

Caudwell is set to meet members of the Conservative shadow cabinet in coming weeks, and has already held productive talks with shadow business secretary Andrew Griffiths.

“Andrew sends me a text message nearly every morning […] and up to now I’ve agreed with everything he said,” Caudwell said.

The billionaire said he plans to vote for the Tories at the next election if it assembles a “really strong” shadow cabinet, and did not rule out donating to the party again if he felt the election was a toss up between the Conservatives, Labour and Reform.

“Would I vote for the Conservatives again? Certainly, I could vote for them again. Would I donate again? I think it’d depend on the political scenario. If I absolutely believed in the Tories, […] I might be persuaded to donate,” he said.

He added that he “could not possibly” vote for Nigel Farage’s Reform UK, because of his conviction that climate change is “the biggest challenge going forward”. 

A government spokesperson said: “This government has the right economic plan, which is why we were the fastest growing European economy in the G7 last year, signed our fifth major trade deal with the Gulf, and our Industrial Strategy is unlocking billions in investment to support thousands of jobs.

“We know some businesses are facing a challenging time, but are backing them through our Small Business Plan, including a £4bn access to finance boost for SMEs, taking tough action on late payments and a £4.3bn business rates support package.”

Caudwell founded Phones4U in 1987 and sold his business group for £1.5bn in 2006.

On Wednesday, Caudwell will mark the opening of Le Provençal, a £300m complex of millionaire residences in the French Riviera which he has been developing for decades.