The boss of Marks & Spencer has warned over a £120 million hit from last week’s Budget measures and said the firm cannot rule out price rises to offset the extra costs. Stuart Machin, chief executive of M&S, said the group would do “everything we can” to avoid passing on the extra burden to customers through price hikes, but admitted the group had a tough challenge to overcome the cost impact. He said the Chancellor’s hike employers’ National Insurance (NI) contributions will increase the firm’s annual tax bill by about £60 million next year – from around £460 million currently to about £520 million.
The increase in the national minimum wage announced in the Budget will also see its staff wage costs jump by another £60 million in 2025, having already risen by around 10% this year. Mr Machin said: “We’ll do everything we can to make sure that cost is not passed on to consumers. “It’s not easy but that’s our ambition.
” But he added the group “cannot rule anything out”, given that it is still early days in working through plans to counter the impact, on top of ongoing efforts to strip out £500 million in costs. He said he “didn’t quite see the double whammy” coming, with the increase in the NI contribution rate – from 13.8% to 15% – coming alongside a significant cut in the threshold for when employers start paying the tax.
He said he was “hoping for something better” from the Budget, also hitting out at Rachel Reeves’s decisio.