Hair and Beauty Sector: Government Policy

Saqib Bhatti Excerpts

Wednesday 23rd April 2025 Westminster Hall

[Saqib Bhatti (Meriden and Solihull East) (Con)]

It is a pleasure to serve under your chairmanship, Ms McVey. I thank my hon. Friend the Member for Hornchurch and Upminster (Julia Lopez) not just for securing the debate, but for making eloquent arguments about the hair and beauty industry and the broader impact of the Chancellor’s damaging Budget last year, such as the impact on nurseries and its knock-on effects. Almost a quarter of a million people are employed in the industry, and it is a disproportionate employer of women and young people. In the short time I have in which to speak, I will limit my comments, because a lot has already been said by my hon. Friend and other hon. Members.

I had the pleasure of visiting the award-winning Aesthetics Hair and Sarah Bowron in Solihull and she eloquently put a lot of the arguments to me. This industry—these businesses—might have never contacted their MP before, because they have never felt the need to do so. Like many small businesses, they just get on with the job in front of them. I am sure that the Minister recognises this, but I am not sure that his colleagues in the Treasury do, so the very first message I would share with him is that small businesses are not there to be squeezed till the pips squeak. There is real concern that the rise in NICs, the reduction in the tax threshold, the impact on part-time workers, the reduction in rates relief and the impending Employment Rights Bill, as well as, of course, the highly competitive market in which the industry operates, will have huge impacts. We have already heard about the impact on the hiring of apprentices.

When there are disincentives on business, such as higher taxation, a much more competitive business environment or higher regulation, it is inevitable that businesses will have to look at where they can cut costs. Young people who come into apprentice positions, who have less training and are yet to learn the skills of the trade, so to speak, are the easiest ones to cut, because the businesses have to be able to continue to operate. I make no comments about his hairstyle or anything like that, but I am sure that the Minister will acknowledge that they are skilled people who do skilled work, and an apprentice cannot just be trained overnight. It takes time to do so.

Hearing from my constituent was certainly eye-opening and helped me to understand the impacts on their businesses. The fundamental point is that businesses in that competitive environment are being forced into a situation where hairdressers go for self-employment status, which means that they are below the VAT threshold, with less return for the Exchequer. That cannot be what the Chancellor of the Exchequer intended when she made her statement.

I have some thoughts about what the Chancellor was trying to do—basically, taxing everyone to appease some of the trade unions—but we will not get into all that right now. The reality, however, is that small businesses are the ones suffering. The impact has been huge. I also share the concern about the impact on high streets and the extended impact on tax avoidance and tax evasion, which of course we are very worried about.