Call to freeze National Insurance ahead of Reeves’s Budget
The Recruitment and Employment Confederation (REC) has called for a freeze on National Insurance and other similarly strong measures to help improve the UK’s job market.
The trade group pointed to a rise in staff availability, falling vacancies, weak pay growth, and declining confidence. Meanwhile, reports circulate of manufacturers delaying investment, hospitality turning away business due to a lack of staff, and NHS Trusts unable to fill critical roles, it said.
“Business was given a Budget of burdens last year,” the REC said. “This time, employers need a Budget for business. This is achieved by providing clarity and making practical changes to the implementation of the Employment Rights Bill. Freezing Employers’ National Insurance and restoring the threshold when possible.”
It added that Skills Levy reform needs speeding up so temporary workers can access training and encourage more private investment.
“Modernising public sector hiring should mean supporting flexible work that maintains quality services and delivers value for money. Resisting poorly evidenced attacks on agency workers in health and education when these workers would be lost to public service otherwise is vital.
“These changes are fundamental to embedding a long-term workforce strategy to support growth,” it said.
Recommendations for Reeves
The REC’s key recommendations for Reeves’s Budget are as follows:
- Relief for employers: Freeze National Insurance and commit to restoring the threshold, reduce regulatory burdens and inject practicality and deliverability into the complexity and cost of the Employment Rights Bill.
- Skills and training reform: Increase levy flexibility, expand short-course funding, and boost reskilling pathways.
- Support workforce participation: Accelerate childcare expansion, healthcare investment, and transport infrastructure to broaden access to work.
- Public sector modernisation: Reform hiring frameworks, remove rigid pay caps and address NHS staffing bottlenecks. Accept that people want to work in different ways, despite what out-of-touch union leaders say.
- Strategic investment alignment: Embed workforce planning in industrial and infrastructure projects to ensure labour market needs are met.
- Public-Private Partnerships: Scale collaboration in construction, green energy, health, and other critical sectors to maximise impact.
“Businesses are the heart of driving investment and growth. They need a Budget that backs them, not more burdens that slow them down, and with it the path to recovery in our economy and the public finance,” said REC Chief Executive Neil Carberry.
“This Autumn Budget is a chance to restore confidence, unlock investment and deliver opportunities through a focus on making the most of the opportunities we have.”
Carberry said that there is clear potential in the economy that is not being realised.
“Consumers are holding cash and firms are optimistic they can deliver, yet this is not translating into hiring or investment while they wait out what the government does next.
“The Autumn Budget can turn confidence into action with bold action that focuses on unlocking potential through delivering on skills reform, supporting business investment and reforming the approach to the Employment Rights Bill, which will slow down growth.”
