Nish Kankiwala, CEO of John Lewis Partnership, criticized recent government budget measures affecting businesses.
- The decision to increase employers’ national insurance is expected to impose significant costs on John Lewis.
- Kankiwala urges the government to reform business rates to alleviate financial pressures.
- Despite cost challenges, the company aims to control consumer prices amidst inflation concerns.
- John Lewis remains committed to its growth strategy despite fiscal obstacles.
Nish Kankiwala, the chief executive of the John Lewis Partnership, has openly criticized the latest government budget for what he describes as a ‘two-handed grab’ on businesses. This critique comes in response to the government’s decision to raise employers’ national insurance contributions and delay reforms on business rates. The increase in national insurance is projected to lead to ‘tens of millions’ in additional costs for the company starting next year.
In a conversation with The Financial Times, Kankiwala expressed surprise at the government’s measures, which he sees as burdensome, including a reduced earnings threshold for national insurance contributions. Despite these challenges, he acknowledged the difficult position the government is in, hinting at the need for a radical shift in business rates, which are set to rise alongside increasing personnel costs. ‘That seems to be, you know, sort of [a] two-handed grab, and that’s unhelpful,’ he commented.
Kankiwala has called for a postponement of the national insurance changes and advocated for a significant overhaul of business rates. He believes that these measures are crucial for providing relief to businesses amid financial constraints.
Amidst the fiscal challenges, John Lewis is focused on mitigating the impact on consumer pricing, especially after a year marked by high inflation. Kankiwala stressed the importance of avoiding a resurgence of inflation, mentioning, ‘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.’
Despite the considerable cost pressures, John Lewis plans to push forward with its current strategy and investment plans. The company has seen improvements in financial performance, reducing its pre-tax losses and is on track to achieve a significantly higher annual profit. Kankiwala confirmed that the company is investing £542 million into operations this year and remains steadfast in its plans for future growth.
John Lewis is committed to growth despite budget-related cost challenges, striving to manage consumer pricing effectively.
