Labour’s National Insurance hike is an ‘existential threat’ to GP surgeries, leading doctors warned last night.
The British Medical Association is the latest body to criticise Chancellor Rachel Reeves‘ £25 billion tax raid on employers’ National Insurance contributions.
In a strongly-worded statement, the doctors’ union called for GP practices to be given funding to cover the full extra costs of the increase.
It said the BMA was ‘astonished at the suggestion that GPs are not part of the NHS family and recognises the existential threat to NHS general practice across the UK by the significant increase of the National Insurance and national living wage burden on general practice after many years of under-investment’.
It comes as retail and hospitality bosses accused Ms Reeves of ‘driving businesses to the wall’.
The British Medical Association is the latest body to criticise Chancellor Rachel Reeves ‘ £25 billion tax raid on employers’ National Insurance contributions
Labour’s National Insurance hike is an ‘existential threat’ to GP surgeries, doctors are warning (file image)
The Chancellor was criticised by the chairman of pub chain Fuller, Smith and Turner, and warned by the British Retail Consortium that job losses and higher prices were ‘inevitable’.
Michael Turner, whose family have run the pub chain since 1845, called the National Insurance raid a ‘direct attack’ on industries such as hospitality that are ‘the lifeblood of our economy, whilst leaving the large City institutions, that can afford to pay their share, almost completely untouched’.
He added: ‘The unintended consequences of these actions will be to drive inflation higher, put pressure on wages, and will drive many businesses to the wall.’
The consortium, which represents household names such as Tesco, Marks & Spencer and Primark, estimates retailers face a £2.3 billion annual increase in National Insurance taxes alone, in addition to other costs going up.
‘The sheer scale of new costs in the autumn Budget and the speed with which they occur, together with costs from a raft of other regulation, create a cumulative burden that will make job losses inevitable, and higher prices a certainty,’ the BRC wrote in a leaked draft of a letter to the Chancellor.
Businesses were blindsided by Ms Reeves’ decision to hike NI by 1.2 percentage points to 15 per cent from April, while a higher minimum wage and new employment rules will compound the pressure on firms.
Labour also lowered the threshold for when firms start paying employer NI contributions – a pressure point for firms who employ many young people on a part-time basis.
Chancellor Rachel Reeves looks at a computer analysing cell sorting experiments during a visit to the new offices of Quell Therapeutics in London
The chief executive of Fuller’s, Simon Emeney, admitted the changes will make hiring students ‘less attractive’, and will push prices up across his industry.
Andy Higginson, the chairman of J D Sports and the BRC, warned if the increases go ahead in ‘one big lump’ next April, there would be ‘significant’ price increases.
His remarks heap fresh embarrassment on ministers as Mr Higginson had been the only FTSE-100 boss to support a letter backing Labour during the election.
But he told the BBC it was ‘hard to see that the actions so far really match that pro-business rhetoric before the election’.
