Greggs, Amazon, Tesco, Asda, Sainsbury's, Aldi warn of job losses and price increases

More than 70 businesses have written to Chancellor Rachel Reeves, warning that the national insurance changes in October's Budget mean price hikes are 'a certainty'

A coalition of Britain's top retailers, including giants like Tesco, Asda, and Sainsbury's, have sounded the alarm over job cuts and inevitable price increases following the national insurance rises outlined in October's Budget.

Over 70 businesses put their names to an open letter addressed to Chancellor Rachel Reeves, expressing their unease about the impending cost surges, with a warning that price rises are a "certainty". The letter emerged after Ms Reeves announced a £25.7bn adjustment to employers' national insurance contributions in the previous month's Budget, which not only increases the tax rate but also the threshold for payment.

The business community is now voicing concerns that the combined impact of the budget measures, including national insurance hikes, packaging levies, and minimum wage increases, could saddle the industry with over £7bn in additional costs annually.

The letter states: "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. 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 outcry has been bolstered by signatures from leaders at Aldi, Amazon UK, Boots, Lidl, JD Sports, Primark, Morrisons, and Greggs. The group said that they would "welcome" the opportunity to have a dialogue with Ms Reeves and have put forward suggested amendments which include a gradual approach in implementing the National Insurance lower earnings threshold, postponing the packing levy timeframe, and re-examining the business rates changes detailed in the Budget.

“By adjusting the timings of some of these changes, the Government would give businesses time to adjust and greatly mitigate their harmful effects on high streets and consumers,” the statement read.

This sentiment resonates with concerns stated in another letter written by UK Hospitality earlier this month and featured in the Sunday Times. Company leaders disclosed fears that positions paying minimum wage might turn "unviable" following the alterations to the national insurance contributions threshold.

On Saturday, Prime Minister Sir Keir Starmer stood by the "tough" economic choices laid out in the Budget amid escalating business discontent and Farm Union protests about the shifts in inheritance tax. "Make no mistake, I will defend our decisions in the Budget all day long" he declared staunchly. I will defend facing up to the harsh light of fiscal reality."

"I will defend the tough decisions that would be necessary to stabilise our economy and I will defend protecting the pay slips of working people, fixing the foundations of our economy and investing in the future of Britain and the future of Wales, finally turning the page on austerity once and for all."