I am not an Economist by any stretch of the imagination. However, over a week after the UK Autumn Budget, now the dust has settled, I wonder what tax and wage announcements made by Chancellor Rachel Reeves are going to have a real impact (positive or negative) on the Food & Drink Industry? For example:
Raising National Insurance contributions by employers (from 13.8% to 15%). Aware that the threshold where businesses start paying NI on workers' pay will be lowered from £9100 to £3500; however, the amount employers can claim back on their NI bill was raised from £5,000 to £10,500. The figure provided is that 865,000 employers won't pay at all. In reality, how will this impact our industry?
The National Living Wage has increased for 21-year-olds and above from £11.44 to £12.21ph. Of course, this is excellent for employees, however, coupled with the Government plans to increase unfair dismissal protections and improve access to paternity and maternity leave, will we see some businesses having to reduce their headcount, or will it prevent their growth plans? I suspect SMEs will face the biggest impact, but for larger organisations, will this ultimately be reflected in increased prices for the consumer?
So will the tax rises through employer NI contributions be a burden on the industry (which employs tens of thousands of people)? Will it mean an additional rise in business costs? Will it impact opportunities for future investment & growth? Will it make food price inflation an ongoing issue? How will it affect smaller, craft businesses? Will this result in job losses and worse, business closures?
I welcome the thoughts of our Industry Leaders and Experts.
