British Apple and Pear Growers Reel from National Insurance Hike: Sector Prepares for Rising Costs

The increase in National Insurance, combined with other recent policy adjustments, is poised to have a substantial impact on the overall costs associated with producing apples and pears in the United Kingdom.

At present, the median cost of growing a kilogram of apples stands at £1.33, but under these new measures, it is set to rise by 7p to £1.40, reflecting an approximate 5.3% increase. This change may appear modest in isolation, yet it bears significant financial implications when considered across entire orchard yields and nationwide production volumes.

A key driving factor behind these rising expenses is employment costs, which account for roughly half of total production outlays for British apples and pears. Due to policy shifts—including a higher National Living Wage—these costs are expected to soar by 10%.

The most prominent regulatory alterations include an increase in employers’ National Insurance contributions from 13.8% to 15%, as well as a reduction in the secondary threshold from £9,100 to £5,000 per year. This lower threshold means that employers will begin paying NICs sooner, further raising their overall wage bills.

As labour is such a substantial component of orchard expenditure, many producers argue that these changes, in tandem with elevated living costs, will inevitably be passed along the supply chain to retailers and, ultimately, to end consumers. Consequently, shoppers are likely to notice higher prices on supermarket shelves for apples and pears.

Beyond immediate cost pressures, the higher financial burden is also dampening growers’ outlook regarding future investment and expansion. Many are wary that continued rises in production costs, coupled with rising regulatory demands, could curtail long-term growth within the sector.

In an effort to temper the negative effects on businesses, the government has announced an increase in the Employment Allowance from £5,000 to £10,500, whilst removing the £100,000 eligibility threshold.

This adjustment is intended to offer some relief to orchard owners and employers; however, industry leaders maintain that additional measures will be required to preserve the profitability and competitiveness of British apple and pear production. They contend that further government support—perhaps in the form of targeted grants, more favourable tax arrangements, or updated labour policies—will be necessary to ensure that UK growers can continue to thrive in a challenging economic climate.