CBA Warns Government: Wage Increases Could Be the Final Straw for Independent Bakers

The Craft Bakers Association (CBA) is warning the Government that further increases to the National Minimum Wage could push already struggling independent bakery businesses beyond breaking point, despite some welcome measures announced in the Budget.

Karen Dear, Chief Executive of the Craft Bakers Association, said:

“Independent bakers are facing unprecedented financial pressure. Changes to inheritance tax, increasing ingredient and energy costs, business rates and the continuing impact of higher employers’ National Insurance contributions are placing an enormous burden on businesses that are already operating on extremely tight margins.

“We welcome the Government’s announcement of an increase in the threshold for Small Business Rates Relief (SBRR) from £12,000 to £18,000. This is a positive step and provides some much-needed recognition of the pressures facing independent high street businesses. However, whilst any relief is welcome, the Government must recognise that this measure alone does not go nearly far enough to offset the cumulative impact of rising employment costs, taxation and the everyday costs of running a bakery.

“Against this backdrop, our members are now facing yet another mandatory wage increase.

“Let me be clear. Our members believe wholeheartedly in paying their employees fairly. They value their teams and want to reward the skills, loyalty and commitment of their workforce. But every increase has to be funded from somewhere, and there is simply no more room to absorb these costs.

“What Government repeatedly fails to recognise is that increasing the minimum wage also affects those earning just above it. Employers are left with little financial flexibility to reward experience, additional responsibilities or long service. The gap between entry-level wages and those of skilled, experienced employees continues to narrow, creating further challenges for businesses trying to retain and develop their workforce.

“We are also deeply concerned about the impact on young people. Independent bakeries have provided first jobs, apprenticeships and career opportunities for generations. Yet at the very time Government is talking about getting more young people into employment, the cumulative cost of employing and training staff risks making those opportunities increasingly unaffordable.

“What is particularly disappointing is the lack of meaningful engagement. Despite the CBA repeatedly highlighting the pressures facing our members, this Government has made no direct approach to us to understand the consequences of its policies.

“Consultation cannot simply be a box-ticking exercise. Our members deserve to be heard before decisions are made, not left to deal with the consequences afterwards.

“Further increases will inevitably force some businesses to reduce recruitment, cut jobs or close altogether. When an independent bakery closes, it is not just a business that disappears. Jobs are lost, high streets suffer and communities lose businesses that have often served them for generations. Our members do far more than provide bread and baked goods. They support local charities, sponsor community initiatives, contribute to local events and play an important role in the communities they serve.

“Whilst the increase in Small Business Rates Relief is a step in the right direction, the Government needs to go much further in recognising the combined impact of its policies on independent businesses. Providing relief in one area whilst continuing to increase costs in another does little to address the overall financial burden.

“We are not asking Government to abandon fair pay. We are asking it to recognise that fair pay depends on businesses being able to afford to employ people in the first place.

“Our message to Government is simple: listen to us, listen to the businesses that sustain our high streets, and listen before it is too late.”