The Bank of England Governor today joined Britain’s biggest retailers including Tesco, Asda and Sainsbury’s warning that job cuts are “inevitable” after Rachel Reeves’s tax-hiking Budget. The Mail has the story.
Andrew Bailey said dozens of businesses – including Tesco, Asda and Sainsbury’s – had been “right” to sound the alarm in an open letter to the Chancellor.
Ms. Reeves unveiled an extraordinary £25 billion hike in employers’ National Insurance Contributions in the Budget last month. The rate has been raised and the threshold at which firms must pay has been cut, with Ministers adamant it was the only way to prop up public services.
But the OBR projected that the fiscal package would boost inflation and unemployment.
In the letter today, the companies cautioned that the huge tax increase, together with packaging levies and increases to the national minimum wage could cost retailers more than £7 billion a year.
“We appreciate Government’s focus on improving the fiscal situation and investing in public services; we also recognise the role businesses have in supporting this,” the letter said.
“But, the sheer scale of new costs and the speed with which they occur create a cumulative burden that will make job losses inevitable, and higher prices a certainty.”
The bosses of Aldi, Amazon U.K., Boots, Lidl, JD Sports, Primark, Morrisons and Greggs were also among those signing.
Giving evidence to the Treasury Select Committee this morning, Mr. Bailey said: “I saw the BRC’s (British Retail Consortium’s) letter and I think they’re right to say, I think there is a risk here that the reduction in employment could be more. Yes, I think that’s a risk.”
Worth reading in full.
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Shorter hours, less stock, higher prices, perhaps. Some might say that it’s good for the environment; guess who will be on the list.
When I was finishing school, supermarkets closed at 5pm on Saturdays and were closed all day on Sundays. I think they did late night Friday. Should cut the staff costs. People who can’t get out to shop during the reduced hours will have to rely on online shopping. Mind you with Ranting Raynor’s 4 day week everyone should have a day for shopping.
Just remind me who can sack this “great thinker”.
Why would Labour ever sack such a good and long time servant. Incompetent I grant you, but he has served leftist interested in the successive jobs where he has failed.
Although it is good to see the BoE commenting on economic affairs for a change (usually it is political or social affairs) I do not recall the BoE objectives include general economic issues.
Their role is to keep inflation within stated limits. They have repeatedly failed.
It’s his fault. He ducked the blame of his incompetence with the LDI overheating and blamed the entirely innocent Lizz at Russ who had just delivered a genuine growth budget. The media scum that have Brexiteers joined in and sold the UK sheep yet another lie.
Many retailers and hospitality businesses, particularly small independent ones, won’t be able to survive the triple whammy:
(3) alone will make most part-time jobs in these sectors non-viable.
The morons are carrying out the coup de grace to our struggling High Streets.
If the High Street closes down, it can be converted into housing for the new Britons arriving on the South Coast.
Oh what a surprise. As I expected inflation is up but not only that it is up to 2.3% from 1.7%. An increase of 35% – great if your income increase is pegged to the September 1.7%. And expect it rise again in January as electricity rises again – 10% last month. Food was the other main increase. The Thieves Job Tax doesn’t come until April but will retailers prepare by increasing prices now?
I assume workers in the public sector are the only ones for whom a pay rise that keeps pace with inflation is a possibility? For private sector employees, below-inflation rises or wage freezes will be the price for holding onto their jobs as companies juggle finances to balance the books. Did Reeves really think she could just take this money from companies without it having a knock-on effect for their employees or customers? I suspect not, but she simply doesn’t care enough about the average Briton to worry about it.