Parliamentarians have been actively discussing the implications of the 2025 Budget on the retail sector, particularly highlighting the financial strain it will place on businesses.
The discussions, held this week, follow concerns raised by the British Retail Consortium (BRC) about the significant costs retailers will face.
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Retail sector facing £5 billion cost burden
The BRC has reported that the retail industry will incur a £5 billion cost from the recent Budget, compounded by an additional £2 billion due to the new packaging levy and the Extended Producer Responsibility (EPR) regulations.
These new financial burdens are expected to significantly affect retailers’ ability to invest, provide part-time employment opportunities, and maintain affordable prices for consumers.
Parliamentarians have voiced their concerns during debates on support for high street businesses and High Street Rental Auctions.
Andrew Griffith, the Conservative MP for Arundel and South Downs, highlighted the devastating effects of these policies, stating that businesses, including pubs, cafés, restaurants, clothes shops, and newsagents, are under serious threat.
Griffith pointed out that the choices made by the government could potentially lead to the closure of many family-run businesses.
Impact on jobs and business rates
David Simmonds, Conservative MP for Ruislip, Northwood, and Pinner, also raised the issue of the rising costs for employers, including increased national insurance contributions.
He echoed the BRC’s warning that these measures could lead to a loss of 160,000 jobs in the retail sector over the next two years, particularly affecting those in part-time and lower-paid positions.
Simmonds also noted concerns regarding changes to non-domestic business rates, which have caused widespread apprehension within the retail industry.
Calls for more cohesive policymaking
In Scotland, there has been a growing call for more coherent policymaking regarding town centre rejuvenation. Gregor Poynton, a Conservative MP, commented on the lack of progress by the Scottish Government in revitalising high streets and town centres.
The Scottish Retail Consortium has echoed these concerns, calling for effective action to support struggling retailers. The BRC and other industry bodies have raised alarms over the potential long-term impacts of the current policy direction.
Lord Taylor of Warwick questions government response
In the House of Lords, Lord Taylor of Warwick tabled a question regarding the impact of regulatory changes and increased employer costs on the retail sector. Specifically, he inquired about the BRC’s assertion that up to 160,000 part-time retail jobs could be at risk as a result of these policy changes.
His question seeks further clarification on the government’s assessment of the situation and its plans to address the challenges faced by retailers.
The ongoing discussions in Parliament underscore the pressing need for a balanced approach to retail regulation that considers the economic realities faced by businesses and their employees.
With many MPs and Peers raising concerns, the issue is expected to remain a key point of debate in the coming months.
