British Franchise Association (BFA)
CEO of the BFA (British Franchise Association) writes to Rachel Reeves regarding NI contributions increase
Pip Wilkins, CEO of the BFA (British Franchise Association), has written to the Chancellor of the Exchequer, Rachel Reeves, to express her ‘grave concern’ following the recent budget. The UK franchising sector currently contributes £19.1 billion to the UK economy.
In her email to the Chancellor, Wilkins said that the increase in NI contributions would ‘unfairly impact the SME market, stifling entrepreneurship, recruitment, retention and appetite for training and investment’.
She urged the chancellor to consider measures to alleviate the strain on franchising businesses, including relief programmes targeted at SME enterprises e.g.: exemptions or partial rebates on employer NI contributions for businesses below a certain revenue threshold or tiered contribution rates based on business size and revenue.’
Ken Deary, a former accountant turned McDonald’s franchisee who founded award-winning homecare franchise Right at Home UK in 2011, which now has over 80 franchisees and a network turnover of £80 million in 2024 and who recently won ‘Franchisor of the Year’ at the BFA HSBC UK British Franchise Awards commented: “The rise in Employers’ National Insurance Contributions and more specifically the size of the NI threshold movement, is effectively a significant tax on jobs, that is already stalling recruitment and putting workers’ jobs at risk, whilst reducing pay increases and bonuses in virtually all companies.”
Ken continued: “Surely, given the feedback from businesses and their employees, the Chancellor must listen and rethink how she raises the tax she needs. She says she has not been offered viable solutions, yet one solution amongst many is a significantly smaller reduction in the NI threshold whilst retaining the 15% rate but offsetting this by increasing Corporation Tax levels. This could achieve the same outcome whilst ensuring companies can protect their workers’ job security and conditions through the medium of taxing profits, not jobs.”
Wilkins concluded: “As an industry we employ 770,000 people, mainly in SME’s. The financial pressures on these businesses have grown significantly in recent years and as franchising’s representative body in the UK we are committed to doing everything we can to lobby the government to support franchise businesses.”
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