JD Wetherspoon boss: ‘Increases in NICs and labour rates will cost £60m’

Increases to employers’ national insurance contributions and national minimum wage will cost an additional £60m per annum, the chairman of Wetherspoon has said.

Although like-for-like sales increased by 5% in the last seven weeks to 16 March 2025 for the group, Tim Martin pointed out the fall-out of the Budget will demand an extra £1,500 per pub, per week.  

Changes to national insurance thresholds will kick in on 6 April, while national minimum wage will rise on 1 April.

Martin said: “Since labour costs are around 35% of the pub industry’s sales, compared to around 11% for supermarkets, increases of this nature inevitably have a disproportionate impact on pubs, exacerbating the already-wide price differential for customers between the on- and off-trade.

“The combination of much higher VAT rates for pubs than supermarkets, combined with increased labour costs will weigh heavily on the pub industry.”

Wetherspoon has long called for VAT equality, as pubs, clubs and restaurants pay 20% VAT in respect of food sales, while supermarkets are not subject to such a levy.

The pub group also posted profit before tax of £32.9m, down from £36m in 2024.

Wetherspoon has expanded its franchised business in recent years, having launched its first franchised pub in Hull University’s student union in January 2022, which was followed by one in Newcastle University in September 2023 and Haven Primrose Valley Holiday Park in North Yorkshire in March 2024.

The company plans to open a further five franchise pubs in the second half of the current financial year, four of which will be in partnership with Haven Holiday Parks.

It comes after the pub giant had received a £6.7m investment from the holiday park operator.

In response to the government’s proposed changes to licensing laws – including the possible reduction of pub and hospitality hours – Wetherspoon said this would “further reduce on-trade consumption, but that reduction is likely to be replaced by ‘off-trade’ consumption at home and in other ‘unregulated’ environments”.

The pub group added: “The word ’pub’ may have a misleading connotation for some ministers and researchers. For example, Wetherspoon’s highest selling draught product by far, is Pepsi. Coffee and tea volumes, which are not in the draught category, are approximately double those of Pepsi. The reality is that products sold in pubs have radically changed in recent decades.”