The CEO of John Lewis, Nish Kankiwala, criticises the UK government’s recent budget measures.
- The increase in employers’ national insurance contributions is foreseen to significantly impact businesses.
- Kankiwala predicts additional costs amounting to ‘tens of millions’ for John Lewis and Waitrose in the coming year.
- The corporation demands urgent reform in business rates to alleviate financial pressures.
- Despite cost challenges, John Lewis remains committed to growth and investment.
Nish Kankiwala, CEO of the John Lewis Partnership, has openly criticised the UK government’s budget decisions for imposing increased financial burdens on businesses. He described the measures as a ‘two-handed grab’, highlighting his discontent with the rise in employers’ national insurance contributions and the delayed reform of business rates. This change is projected to significantly escalate costs for John Lewis and Waitrose.
Kankiwala forecasts that these adjustments will result in ‘tens of millions’ in extra costs for the partnership from the next year. Despite acknowledging the challenging decisions faced by the government, he emphasised the negative impact on the company, particularly due to the lowered earnings threshold for national insurance contributions.
He further advocated for a ‘radical change in business rates’, pointing out their increase and the rising costs associated with staffing. Kankiwala stated, ‘That seems to be, you know, sort of [a] two-handed grab, and that’s unhelpful.’ He proposed that delaying the national insurance adjustments alongside a fundamental reshaping of business rates could alleviate some financial pressure.
Additionally, Kankiwala expressed concerns about the effects of inflation on consumer prices. After managing record high inflation over the past year, he voiced the company’s intent to mitigate price increases. ‘The last thing we need is a resurgence of inflation, because we just got that under control, and inflation is not good for anybody… We will try and control [pricing] as much as possible,’ he remarked.
Looking ahead, Kankiwala assured that the John Lewis Partnership remains on track for a ‘significantly higher’ full-year profit. Recent efforts to reduce pre-tax losses significantly from £59 million to £30 million have bolstered optimism. Despite the looming cost pressures, the company is investing £542 million into its operations this year, maintaining its strategy and commitment to future growth.
John Lewis continues to prioritise growth and investment while negotiating substantial financial challenges posed by recent government policies.
