On a number of occasions over the last few months, Labour Party officials and Ministers have stated that ‘food security is national security’.
But the level of concern, frustration, and even anger from the food and farming sector towards the government’s first Budget has all but eroded any optimism it may have drawn from that sentiment.
The list is worryingly long.
From Inheritance Tax, namely changes to Agricultural Property Relief and Business Property Relief, to the carbon border adjustment model, Capital Gains Tax to pickup trucks, there appears to be an impact for all of us. While the issue of Inheritance Tax has taken most of the headlines, and for very good reasons, we are acutely aware that for many horticultural businesses, the rise in the NLW (National Living Wage) and the changes to NI (National Insurance) rules will have an even greater impact.
Impact on food security
By April 2025, the NLW will have risen over 40% in just five years.
Some members have been telling us the rise in wages next year, combined with the NI rule changes and sickness pay benefits, will add hundreds of thousands of pounds (in some cases over £1m) to the cost of employment.
Estimations are that, combined, these increases place up to 10% annual wage inflation. The ‘differential’ in wages is also getting squeezed which demotivates workers above the NLW, yet offering them the same level of increase is beyond the financial capabilities of most of our members.
“It is critical the government understands the impact of what it has done and why those measures need to be reviewed.”
NFU Horticulture and Potatoes Board chair Martin Emmett
Securing the best pay and conditions for those working in the sector should be a common goal – but implementing this scale of change, with such short notice, leaves supply chains unable to service the additional costs and consequently impacts our food security.
Amplifying the message
We are not alone in raising our concerns with the government on these changes. The Federation of Small Businesses, British Retail Consortium, and more have called out these measures as being overburdensome, costly, and a threat to business viability and to jobs.
These are, of course, national measures which affect all businesses across the UK, not just those in the supply chains we operate. But it is critical the government understands the impact of what it has done and why those measures need to be reviewed.
There are a number of actions you can take to amplify the messages that we, and others, are delivering.
Firstly, for those attending the ‘mass lobby’ organised by the NFU to get in front of hundreds of MPs in Westminster next week, take this opportunity to set out how these employment changes will affect your business.
If you’re not part of the mass lobby, you can still reach out to your local MP by writing to them or meeting with them to call for their support for these measures to be reviewed. Critically, we also need to deliver a clear and consistent message to our major customers, particularly the retailers, that these costs cannot be borne by suppliers alone.
Cost inflation is inevitable, and it must be passed on.
Please do keep in touch with us at [email protected] and let us know your concerns. The more information and evidence we have, the stronger our arguments can be.
