Employers’ £25bn contributions to Rachel Reeves’ National Insurance could force GP practices to close, doctors warn

Labour’s national insurance hike is an ‘existential threat’ to GP practices, leading doctors warned last night.

The British Medical Association has become the latest body to criticize Chancellor Rachel Reeves’ £25 billion tax raid on employers’ national insurance contributions.

In a strongly worded statement, the doctors’ union called for GP practices to be funded to fully cover the additional costs of the increase.

It said the BMA was ‘surprised by the suggestion that GPs are not part of the NHS family and recognizes the existential threat to NHS general practice in the UK from the significant increase in national insurance and the national living wage burden for the general practice after many years. of underinvestment’.

It comes as retail and hospitality bosses accused Ms Reeves of “driving businesses up the wall”.

Labour’s national insurance increase is an ‘existential threat’ to GP practices, doctors warn (file image)

The chancellor was criticized by the chairman of pub chain Fuller, Smith and Turner, and warned by the British Retail Consortium that job losses and higher prices were ‘inevitable’.

Michael Turner, whose family has run the pub chain since 1845, called the National Insurance raid a “direct attack” on sectors such as hospitality which are “the lifeblood of our economy”, while slamming major city institutions that can afford to to pay money. parts, almost completely untouched’.

He added: ‘The unintended consequences of these actions will be that inflation will rise, wages will come under pressure and many businesses will be driven up the wall.’

The consortium, which represents household names such as Tesco, Marks & Spencer and Primark, estimates that retailers alone will face a £2.3 billion annual increase in national insurance taxes, among other rising costs.

“The sheer scale of new costs in the autumn budget and the speed at which they are occurring, together with the costs of a range of other regulations, create a cumulative burden that will make job losses inevitable and higher prices a certainty,” the BRC wrote. in a leaked version of a letter to the Chancellor.

Businesses were blindsided by Ms Reeves’ decision to increase wage payments by 1.2 percentage points to 15 percent from April, while a higher minimum wage and new labor rules will increase pressure on businesses.

Labor has also lowered the threshold for when companies will start paying employer contributions to the NI – a pressure point for companies that employ many young people part-time.

Chancellor Rachel Reeves looks at a computer analyzing cell sorting experiments during a visit to Quell Therapeutics’ new office in London

Fuller’s CEO Simon Emeney admitted the changes will make hiring students “less attractive” and drive up prices in his sector.

Andy Higginson, the chairman of JD Sports and the BRC, warned that if the increases go through in ‘one big lump’ next April there would be ‘significant’ price increases.

His comments add fresh embarrassment to ministers as Mr Higginson was the only FTSE-100 boss to back a letter backing Labor at the election.

But he told the BBC it was “difficult to see that the actions so far really match the pro-business rhetoric from before the election.”