Further costs are heaped on the industry with this week’s announcement from the department of trade and industry of a six per cent hike in the minimum wage in October. The news has been greeted with warnings and dismay from sectors of the trade.

The Association of Labour Providers warned that it will be difficult for its members to secure the necessary increase from their customers in fresh produce. “With supermarkets continuing to put downward pressure on costs, the fact that the minimum wage is increasing is no reason for labour-users to pay more for labour,” warned Mark Boleat. “They should know that if they are paying £6 an hour that is not enough for labour providers to cover all the legal costs. What sometimes happens is that the only way to make ends meet is to evade tax and we are hoping that the tax authorities will be far more vigilant in the future.”

The British Retail Consortium has said it is “disappointed” with the above-inflation rise and that it puts 35,000 jobs at risk and adds a further £1.13 billion to retail industry costs.

“We are dismayed, but hardly surprised, that the government has agreed to another above-inflation increase in the national minimum wage,” said BRC director general Kevin Hawkins. “However, it is more encouraging to hear that the Low Pay Commission will no longer assume that the minimum wage will increase every year. It has clearly listened to and acted on BRC representations that future decisions must be strongly influenced by the ability of businesses to absorb further cost increases.” l

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