Increase in minimum wage little consolation if food prices soar

But the fact that Greggs is the latest in a whole raft of retailers warning that their prices will increase as a direct result of the Budget is cause for concern indeed.

Greggs’ chief executive Roisin Currie said the business faced a bigger expenses bill this year as a result of an increase to the minimum wage and an increase to the rate of employer national insurance.

Similarly, Marks & Spencer says the Budget has led to a £120 million increase in its costs, some of which may need to be passed on to consumers. Tesco, which has more than 300,000 employees, said the rise in National Insurance alone will add £250 million a year to its costs, and that is before the effects of the rise in wages, which has yet to be assessed.

Overall, the British Retail Consortium estimates that the Budget will add £7 billion to retailers' overheads, leading to a 4.2 per cent rise in food prices in the second half of the year. If this means people have less money in their pockets, it follows that they will probably buy less, potentially leading to shop closures and job losses.

In the General Election campaign, Sir Keir Starmer repeatedly promised there would be no taxes on 'working people' if he was elected. With every passing day, it becomes clearer that the increase in employer National Insurance contributions is a tax not just on so-called working people, but on everyone.

As for the increase in the minimum wage, it will be scant consolation if it leads to a return in inflation and soaring food prices.