TESCO TO SHUT SHOPS EARLY AFTER REEVES TAX RAID: “When will Labour wake up and realise their Budget isn’t helping the economy — it’s hurting the very businesses that keep Britain running?”
Tesco is closing some of its stores earlier as it grapples with a £235 million surge in staff costs following Chancellor Rachel Reeves’s recent tax changes.
Britain’s biggest supermarket is piloting shorter opening hours at a number of its Tesco Express branches, with doors now shutting at 10pm instead of 11pm in some locations. Insiders say the stores affected are among the least profitable and have been nicknamed “Express Lite” shops internally.
The move comes as the retail giant scrambles to offset a wave of extra charges brought in by Reeves’s Budget, including a sharp rise in National Insurance contributions and a hike in the minimum wage.
A Tesco spokesperson told the Telegraph: “We are trialling a simpler way of running a small number of our Tesco Express stores, designed to make things simpler for our colleagues and to ensure that we are running these shops in the most efficient way.”
Another spokesperson said: “When will Labour wake up and realise their Budget isn’t helping the economy — it’s hurting the very businesses that keep Britain running?”
Staff have been told fewer workers will be needed on shift at the affected stores. While Tesco insists there will be no job losses, some workers may be asked to move to other locations.
The cost crunch follows Reeves’s decision in April to raise employers’ National Insurance from 13.8% to 15%, while lowering the threshold from £9,100 to £5,000 a year – hitting businesses with a double whammy. Retailers also had to stomach a 6.7% increase in the minimum wage, bringing the total extra cost to the sector to £7 billion, according to the British Retail Consortium.
Tesco chief executive Ken Murphy warned in April: “We’re stripping out around £500m of costs to offset the Budget hit,” adding, “All we’re saying as an industry is, don’t make it too hard for us to keep delivering great value.”
The retail shake-up mirrors similar moves in other sectors. Earlier this year, pubs began calling last orders earlier, with some shutting at 9pm to cut staffing costs.
Tesco insists the “Express Lite” changes won’t affect customers, saying: “These changes aren’t visible to our customers, who will continue to receive the same great service they expect, and there are no changes to the range of products we sell.”
But the squeeze is being felt across the high street. Rivals like Asda have launched aggressive price wars to win back customers, with chairman Allan Leighton boasting last week: “We’ve opened up a price gap with Tesco.”
Tesco, meanwhile, is bracing for a 14% drop in profits this year as it prepares to pump £400 million into price cuts to stay competitive.
The clock may not have struck midnight yet, but for some Tesco stores, closing time just got a whole lot earlier.
