Next boss Simon Wolfson leads Lords charge against National Insurance hike

The CEO of retail heavyweight Next, Lord Wolfson, has thrown his support behind efforts in the House of Lords to amend the proposed changes to employer's National Insurance Contributions (NICs). Baroness Noakes has tabled amendments to the bill which have garnered Lord Wolfson's backing.

In the Labour Budget last Autumn, Chancellor Rachel Reeves announced an increase in NICs from 13.8% to 15%, alongside a reduction in the threshold for employee wage eligibility for the tax from £9,500 to £5,000 per year, as reported by City AM.

Lord Wolfson, a Conservative peer since 2010, recently expressed concerns to the BBC that the tax hikes outlined in the Budget would make it increasingly difficult for individuals to enter the workforce.

He criticised the government's approach to raising national insurance, highlighting the impact on entry-level positions: "The government did need to raise taxes. I’ve got nothing against lowering the threshold for NI in principle but the speed at which it is going to happen, the lack of consultation, that is the problem," he stated earlier this month.

Baroness Noakes has suggested "a phased introduction of the reductions to the secondary threshold" for the tax, as reported by The Times.

The legislation is currently at the committee stage in the Lords.

The government's changes to National Insurance Contributions (NICs) have been criticised for a lack of consultation with those affected, including farmers who have expressed concerns about the lack of dialogue prior to changes to inheritance tax on farmland.

The alterations to NICs, particularly the lower threshold, came as a surprise to labour-intensive, part-time reliant sectors such as hospitality and retail.

"NICs were out of the blue," Pizza Pilgrim’s co-founder Thom Elliot told City AM last year. "[They] will have an impact."

According to UK Hospitality, a fifth of the hospitality workforce will be drawn into the new employer NICs threshold for the first time when the changes take effect.

"The extent of the impact will be enormous," said Kate Nicholls, Chief Executive of UKHospitality.

"This tax is already forcing businesses to abandon investment, change recruitment plans, reduce headcounts and increase prices to cope with these cost increases."

Two thirds of retail CFOs have indicated that their businesses will be forced to raise prices due to higher wage bills.