Business
• Analysis
High street bosses urge John Healey to cut the cost of employing young people in first budget
Major retailers and hospitality firms including Tesco, Costa Coffee and the Co-op met chancellor John Healey at No 11 on Tuesday morning to urge him to cut the cost of employing young people in his first budget, asking for a higher national insurance earnings threshold.
By Haut Monde Post
• October 14, 2026
• 2 Min Read
What the firms are asking for
The retailers and hospitality businesses want a partial reversal of Rachel Reeves' decision to lower the earnings threshold at which employers start paying national insurance contributions from £9,100 to £5,000 a year. Their specific request is that the national insurance threshold be raised to £6,000, which they argue would help create jobs and ease inflation pressures on high streets.
According to the firms, that lower threshold has played a part in youth unemployment climbing, as high street employers have cut back on roles for young people and those working part time.
Who was in the room
Tuesday morning's gathering at No 11 brought the chancellor together with senior figures from the sector, among them Stuart Machin of Marks & Spencer and Sainsbury's chief executive Simon Roberts. Employers' national insurance contributions, and what their increase has meant for businesses, were on the table.
One source at the meeting came away positive about how the chancellor received the case:
It felt like they were listening.
Retail's wider tax case
Retail and hospitality firms also hope Healey will ease the burden of business rates, and one source close to the meeting said they were optimistic on both fronts.
Helen Dickinson, chief executive of the British Retail Consortium, described retail as a major driver of growth, supporting jobs, investment and communities across the country, and providing vital first jobs and career opportunities for young people. She said retailers' taxes had risen 20% in two years, including an extra £6.5bn in new employment costs, and warned that any new costs would be paid by consumers at the till.
Dickinson said the chancellor recognised these pressures, and described a positive discussion about a shared ambition for growth and tackling youth unemployment, adding that his first budget is the chance to turn that ambition into action.
Healey's position
The chancellor has vowed to ease the cost of doing business amid mounting pressures on firms from rising energy bills. A Treasury spokesperson declined to comment on speculation, saying: "decisions on tax are a matter for the chancellor to set out at fiscal events rather than routinely commenting on rumour, speculation or proposals."
The next step is the chancellor's first budget itself, where he has vowed to ease the cost of doing business.
