Sainsbury's Boss Urges Chancellor Against Further Business Burdens
Retail chief Simon Roberts calls for tax and regulatory relief in upcoming budget, citing inflation and previous policy impacts.
The chief executive of Sainsbury's, Simon Roberts, has urged Chancellor John Healey not to increase the burden on British businesses, emphasizing the need for relief rather than additional taxes or regulatory impacts.
Roberts stated that the upcoming budget should focus on easing pressure on an industry already facing significant taxation. His comments come after Healey indicated a commitment to supporting "bloody-minded entrepreneurs" and fostering business profitability, potentially through red tape reduction. However, some business leaders remain skeptical, recalling previous national insurance hikes imposed by Healey's predecessor, Rachel Reeves.
Roberts highlighted that in discussions with the government, he has clearly articulated the drivers of inflation and the importance of avoiding policies that could exacerbate the situation. He specifically pointed to the increase in national insurance contributions within the 2024 budget, which raised costs for the retail and hospitality sectors, and cautioned against actions that could worsen conditions.
Andrew Murphy, CEO of toy retailer The Entertainer, echoed these concerns, suggesting that while Reeves had engaged with businesses, her policies ultimately moved in the opposite direction of their recommendations. He added that minor adjustments would not be sufficient to make a significant impact.
Other business leaders, including those from Marks & Spencer and JD Sports, have also called for a rollback of national insurance increases. Murphy noted that such a change would enable his company to hire more staff on various contract lengths.
The national insurance rate had been raised from 13.8% to 15%, with the threshold for employer contributions lowered from £9,100 to £5,000, increasing the number of employees on part-time contracts subject to the levy.
Financial institutions are also apprehensive about potential tax increases, fearing it could impair their ability to lend to the broader economy. Chris Hayward, policy chairman of the City of London Corporation, stated that while reduced business costs would be welcomed, taxing banks could lead to reduced lending to small and medium-sized enterprises (SMEs), potentially hindering their growth.
Shadow chancellor Andrew Griffith suggested that businesses would be right to be skeptical of Healey's promises, proposing the repeal of Labour's Employment Rights Act as a more meaningful measure.
In parallel, the British Chambers of Commerce (BCC) urged the Chancellor to reduce employment costs, citing a survey where 71% of businesses reported difficulties in hiring staff. Patrick Milnes of the BCC recommended cutting employer national insurance contributions for individuals under 25 to lower the cost of employing young people.
Industry bodies representing pubs and restaurants have also appealed to the government to decrease the tax burden and remove obstacles to investment, growth, and job creation across the country.