B usiness leaders were, on the whole, delighted ten weeks ago when Peter Mandelson rejoined the Cabinet. Having such a business-friendly figure at the heart of government could only be good, they thought.

Since then, the Chancellor has promised a 45p top rate of income tax and announced plans to raise employer’s national insurance contributions.

Now comes a Queen’s Speech that will increase business costs.

Of particular concern are proposals to let town halls hit companies with a supplementary business rate of up to 2p in the pound. And it is not as if struggling shopkeepers and restaurant owners, already grappling with dreadful trading conditions, will get to vote on it.

Powers to let council chiefs reduce, as well as raise, business rates might have been more appropriate in the current climate.

None of this will give business people comfort that the Government is listening to them.

Then there are the new measures on flexible working. One of Lord Mandelson’s first acts was to demand a rethink on this.

Yet, faced with opposition from the likes of Harriet Harman and Yvette Cooper, he has backed down.

The new measures may not look onerous, but they are hardly helpful at a time like this.

A generous interpretation of events is that Lord Mandelson has backed down on these proposals to focus on more damaging measures that were left on the cutting room floor. But then business can’t afford to be generous these days.

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