THE CONCERNED boss of a Rugby heating company says small businesses will be ‘disproportionately burdened’ by extra employment costs due to come into effect next month.
Lincoln Smith, Managing Director of Custom Heat, says he is facing an additional £118,000 in employment costs – around £70,000 in National Insurance Contribution increases, and the rest due to rises in the National Minimum Wage – which will ‘severely impact’ the business.
But Rugby’s MP says the changes are necessary to avoid a return to ‘the austerity and instability of the past’.
Mr Smith said: “These increases will severely impact our ability to invest in our future. Plumbing businesses like ours work hard to provide a good life for our employees, with just a little bit left at the end.
“If we had experienced these combined increases last year, our end of year results would have shown a significant loss. We simply wouldn’t have made enough money to cover these extra employment costs.”
He said the business was being ‘hit from all sides’, with government policies pushing the industry toward heat pumps and electrification.
He added: “Penalties on gas and oil systems are passed down from manufacturers to us. Then there’s the National Insurance Contribution increases alongside higher minimum wage requirements for our apprentices. We’re in a particularly difficult position having to absorb costs from everyone in the supply chain.
“When we have to increase our prices to cover these costs, it’s the working person who ultimately pays for it.”
He added he was concerned the cost increases would limit the company’s ability to continue training the next generation of heating engineers.
Rugby MP John Slinger said the choice had to be made to tackle the ‘£22billion black hole in the nation’s finances left by the Conservatives’.
He added: “The decision on employer National Insurance is a difficult but right choice, and is necessary to avoid a return to the austerity and instability of the past.
“The average worker is around £700 worse off than they were in 2010. Boosting the national minimum wage and living wage will give the lowest paid workers the pay rise they deserve, benefitting millions of people.
”I’m proud to support a government that is pro-business, pro-worker and pro-growth. I meet businesses of all sizes regularly, the Chamber of Commerce, and other business groups, so that I can hear about the challenges and opportunities and we can work together for a more prosperous Rugby and surrounding villages.”
