CBI calls on Chancellor to halt further rises in business costs

Employer secondary Class 1 National Insurance contributions rose from 13.8 per cent to 15 per cent on 6 April 2025, while the secondary threshold — the point at which employers begin paying — was cut from £9,100 to £5,000 a year, according to HM Revenue and Customs. Those two changes together mean employers pay a higher rate on a wider portion of each worker’s earnings.

The CBI posted its position on 28 September 2026, quoting its Deputy Chief Economist directly.

Alpesh Paleja, Deputy Chief Economist at the CBI, said: “Against the backdrop of renewed fiscal pressures, the Budget must draw a red line under any more rises in the cost of hiring, investing and doing business.”

The 2025 package did include some relief. The maximum Employment Allowance — which eligible employers can offset against their National Insurance bill — doubled from £5,000 to £10,500, and the previous £100,000 eligibility cap was removed entirely, according to HM Revenue and Customs. That means larger employers who previously could not claim it are now able to do so.

The CBI’s call focuses on cumulative cost pressure rather than any single measure. The total additional burden on UK businesses from the April changes has not been independently quantified in the available material.

Official data offers a mixed picture. UK business investment rose 1.7 per cent in Quarter 2 2026 compared with the previous quarter and was 0.8 per cent higher than in Quarter 2 2025, the Office for National Statistics’ provisional estimate shows. But the figures don’t establish whether that growth came because of or despite the change in employment costs. UK real GDP grew 0.6 per cent in Quarter 1 2026, according to the same source.

The date and specific measures of the Budget referenced by the CBI had not been confirmed in an official Budget document at the time of reporting.