'You shouldn't cripple us': North West businesses react to Labour budget
ITV News' Political Correspondent Lise McNally explains what the budget means for the North West.
A local business preparing for one of its busiest days of the year says it doesn't feel like the Labour Government is "supporting small businesses" as the Autumn budget is announced.
The government hopes the historic Budget - Labour's first since 2010 and the first delivered by a female chancellor - will convince the public that it can "rebuild Britain" and restore its creaking public services, with pledges to "invest, invest, invest".
Lily's Vegetarian has been serving Indian food in Ashton-under-Lyne for more than 50 years, and they worry the new policies announced today by Rachel Reeves will make things even tougher for small businesses.
The manager of Lily's Prital Sachdev said: "It's been difficult for everyone, but it does seem to be hitting smaller businesses even harder. We don't have multiple chains, we're a small independent."
Reeves announced an increase to national insurance employer contributions by 1.2 percentage points to 15%, which will come into effect from April 2025, she confirmed.
She also lowered the Secondary Threshold, the level at which employers start paying national insurance on each employee’s salary, from £9,100 per year down to £5,000.
"I know that this is a difficult choice. I do not take this decision lightly," she said, pointing out that this will raise a huge £25 billion per year.
Reacting to the news, Prital said: "It was anticipated but it increases our overall payroll. It has an affect on the bottom line. Does that mean reduced employees or higher prices? We'll have to see."
To protect small businesses, Reeves announced employment allowance will rise from £5,000 to £10,500.
She also announced the minimum wage will increase by 6.7% from £11.44 to £12.21 per hour from April, while for 18-20-year-olds, it will rise by 16.3% from £8.60 to £10.
On this increase, Prital said: "It will have an affect on the business. We have chefs that have come from India to cook here, and employees that have been with us for 10 to 15 years. So it's not fair to say 'oh sorry we can't afford you.'
"We don't want to lose anyone so it may mean prices go up a bit."
While Prital doesn't expect he'll be forced to let staff go, he worries the increase in prices will have other effects.
He said: "We're fortunate that our customers come to us and chose us, but there will be a point where they only come once a week instead of twice."
Prital has worries about the effects of Rachel Reeves' budget, but still believes it's too soon to judge the new Labour Government.
He said: "I think the Government needs to be judged in a few years time. They've made a lot of promises so lets see where they take us.
"The crackdown on fraud and tax evasion, they are all positive points and should be carried out. But at the same time you shouldn't cripple businesses."
Just 30 miles north, shoppers in Burnley Market gave their thoughts on the budget.
Sitting in the market's cafe, one pensioner said: "It's really bad... get them out I say.
"We're losing the winter fuel allowance, and we should really have that to help us get by."
Previously, anyone over state pension age could receive the payment, but this was changed by the new Labour Government, meaning about 10 million pensioners will miss out this year.
She continued: "The minimum wage rise is fine, but we're not working so it doesn't help us."
Other shoppers were surprised to hear the news that the £2 bus fare cap will rise to £3.
One person said: "Putting it up to £3 seems nonsensical to me. Lots of people rely on the buses and many of them might not be able to afford that.
Another added: "At the start of the (Labour Government) I was really confident - I thought they'd be a fresh start for the UK, but ever since I've not really been keen on what they're doing."
On the other side of the market, Tariq is the owner of Simply Spectacles, where he sells glasses and eyewear. As a small business owner, he is happy to pay more taxes "if they're being spent well."
He said: "If they're going to the right places I don't mind, but right now it's impossible to see my GP and the potholes on the main road are awful. That's where they should be spent instead of funding places like Ukraine.
"It's a new government so I'm willing to give them the benefit of the doubt, but they've scored a few own goals already."
On the Isle of Man, the Government has agreed to incorporate Rachel Reeves' plans into their own budget, which is set to be announced in February 2025.
Treasury Minister Dr Alex Allinson MHK said: ‘The Treasury is examining the full impact of the announced changes for our Island. There was extra support for working families and investment in the health services and education, all of which were main policies of our own Budget this year.’
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