John Lewis Partnership’s CEO has criticised the UK government’s budget measures, calling them a “two-handed grab”.
- The company anticipates “tens of millions” in additional costs due to increased employer national insurance contributions.
- Further costs are expected because of delayed business rates reform, which is seen as detrimental by John Lewis.
- Nish Kankiwala, CEO, urges the government for radical business rates change, emphasising its significance.
- Despite financial pressures, John Lewis maintains its strategy and significant operational investments.
John Lewis Partnership’s CEO, Nish Kankiwala, has openly criticised recent UK government budget measures, describing them as a “two-handed grab” from businesses. The government’s decision to increase employers’ national insurance contributions paired with delayed business rates reform is expected to result in “tens of millions” in additional costs starting next year, affecting the company significantly.
Kankiwala expressed the company’s shock over these measures, particularly noting the lowered earnings threshold for national insurance contributions, which adds to their financial burden. Despite acknowledging the government’s challenging fiscal decisions, he insists that there needs to be a radical overhaul of business rates due to their projected increase along with rising personnel costs.
The CEO highlighted that in light of record-high inflation over the past year, controlling consumer prices remains a priority for the company. “The last thing we need is a resurgence of inflation, because we just got that under control, and inflation is not good for anybody…We will try and control [pricing] as much as possible,” Kankiwala stressed.
Even amidst these financial pressures, the company is on track to deliver a “significantly higher” full-year profit. This positive outlook follows a reduction in pre-tax losses from £59m to £30m within the six months ending 27 July.
Kankiwala reaffirmed that the company is continuing its strategic path, confirming an investment of £542m into operations this year. The strategic vision and future growth plans remain intact, notwithstanding the anticipated rise in costs.
John Lewis is committed to navigating financial challenges while maintaining strategic growth and investment plans despite government fiscal policies.
