Debate contribution: Autumn Statement 2024: Impact

Debate contribution by Ms Diana Armstrong on 8 April 2025.

MLA

Ms Diana Armstrong

Party at the time

Ulster Unionist Party

Date

8 April 2025

Type

Debate contribution

Business

Committee Business

Heading

Autumn Statement 2024: Impact

Assembly identifier

Official Report component 4919865

Read the official Assembly record

Text

It is good to hear unanimity in the Chamber today. I wish to address my comments specifically on the impact that the increase in National Insurance contributions and the minimum wage will have on the hospitality and retail sectors. Indeed, I have been lobbied by those sectors in my constituency to use my voice to raise the problems that they face. However, it must be noted that industry stakeholders consistently report that the increases will be catastrophic to an array of sectors in Northern Ireland, particularly the community and voluntary sector, as we have heard, at a time when businesses and community and voluntary sector organisations need support and not challenges. The hospitality sector, in particular, has been brought to a cliff edge by the changes. Was it not enough that prices were rising and staff retention was an issue or that they faced exorbitant energy and rates bills? The increase in the minimum wage and National Insurance contributions may well be the final straw that leads to many hospitality businesses closing their doors. In addition, as referenced earlier, the hospitality sector relies on many young, part-time workers. Figures show that 63% of jobs in the accommodation and food sectors are part-time, and those employers will be particularly exposed by the lowering of the threshold for employers' National Insurance contributions. Hospitality and tourism account for over 77,000 jobs here and, together, contribute nearly £2 billion to Northern Ireland's economy. The proposals in the Budget served only to decimate that already struggling sector. One of my constituents gave the example of licensed premises with accommodation that is located in a rural town and employs 23 staff: 13 are full-time, 10 are part-time and six are under the age of 18. The business contributes £20,000 in rates annually. The company's turnover was almost £1 million in the last trading year, but it made a loss of just under £100,000 before tax. It was moving back into profit this year, but that has now been threatened by the Budget announcements. That business faces the key challenges of energy costs, cash flow management, recruitment and retention of quality staff, taxation levels and the cost of investment. Fourteen staff are directly affected by the change in the national living wage — that is two thirds of the staff, including the part-timers. The combination of the increase in the national living wage and the change in employers' National Insurance contributions will add 8% to the current wage bill, increasing it from £408,000 to £440,000. It means that the company has to find another £32,000 when it is already making a loss of £100,000. What will it do? The only available options are to take on fewer workers, give workers fewer hours, scale back the customer offering or try to put up prices. Those options are unsustainable for people and employers in the hospitality sector. The picture is equally bleak for our retail sector. In February, I took part in Retail NI's 2025 High Street Summit, where stakeholders from across Northern Ireland gathered to discuss the challenges facing the sector. Survey results revealed by Retail NI that day make for particularly grim reading. It found that the average cost to Retail NI's members, as a result of National Insurance and minimum wage increases, will be £90,000 per annum. Some 74% said that they would have to reduce their workforce and their staff's hours, 89% are seriously concerned about the impact of rate increases, and 96% believe that the Executive need to do more. It is abundantly clear that the increases are the last thing that our hospitality and retail sectors need at this time. Westminster and, indeed, Stormont should focus on how we can ensure the long-term viability of those local businesses, rather than bombarding them with even more punitive measures that serve only to harm them. The Budget will make the most vulnerable worse off and harm our local economy at a time of heightened geopolitical tensions. I support the call for a coordinated response from the Minister of Finance and the Minister for the Economy, along with the findings of the cost of doing business in Northern Ireland research, to demonstrate the devastating impact that the autumn Budget will have on the economy here.

709 words. Text as published by the Northern Ireland Assembly.

Assessment

Not flagged

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Assessed 21 October 2026 at 12:21 UTC by jev-1.13.0 (requested as typesafe/jev) under rubric 2026.10-r9, methodology 1.9.

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