Question to the Department for Business, Energy and Industrial Strategy:

To ask the Secretary of State for Business, Energy and Industrial Strategy, what plans his Department has to help manufacturing and small businesses deal with potential increases in labour costs resulting from the proposed increase in the national living wage announced in the Autumn Statement 2016.

The Government appreciates that the increase in the National Living Wage may mean extra costs for manufacturing and small businesses and is committed to ensuring that the National Living Wage works for businesses of all sizes.

The Government has increased the Employment Allowance by 50% from April 2016, giving employers a £3,000 employer National Insurance Contributions discount. This is estimated to benefit up to 500,000 businesses who, as a result, can employ four people full time on the current NLW and pay no National Insurance Contributions. The increase in the allowance is of greatest benefit to small businesses. We are also extending Small Business Rate Relief, meaning that 600,000 small businesses will pay no business rates at all.

In addition, the cut in corporation tax from 20% to 17% by the end of the Parliament will benefit over a million firms of all sizes and give the UK the lowest rate of corporation tax in the G20.