Reacting to: What do people in NI want to see in the Budget? (BBC News NI, 28 October 2026) →
Chancellor John Healey delivers the Budget today, and Stormont's Department of Finance won't publish its own calculation of what Northern Ireland actually gets until later in the day. For most Northern Ireland business owners, though, the number that changes next year's payroll bill isn't the block grant settlement at all. It's the minimum wage rise widely expected in the same speech — and unlike the funding gap between Westminster and Stormont, this one lands on your payroll from 1 April whatever else is agreed.
One Belfast business owner has already shown her own working. Christina Taylor, who owns Shed Bistro in south Belfast and employs about 30 staff, told BBC News NI that last year's minimum wage rise meant every guest needed to spend £4.50 more just to cover it — and she doesn't think customers can absorb another round the same way. That's the real test of today's Budget for a Northern Ireland employer: what the next line on your payroll run actually costs.
What's confirmed before the Chancellor speaks
Three things are already on the record, ahead of Healey's speech this afternoon. The government has offered Stormont an additional £525m this year. The five Executive parties say they need closer to £1.5bn to put together a workable budget, so the gap is reported directly by all sides, not estimated by us. Finance Minister John O'Dowd said on Wednesday there is "a duty on the government to fairly fund this place," calling for "a fair and sustainable settlement" because the money on the table "is not sufficient for us to be able to move forward, pay our public sector workers and sustain public services and grow our economy." DUP leader Gavin Robinson said it "wouldn't be realistic" to expect the gap to close entirely, but that the Budget could make it "more manageable."
A minimum wage rise is expected, but not at the same rate for every age band. It emerged this week that workers aged 18 to 20 are set to see a smaller increase than in previous years, while the headline rate for workers 21 and over is expected to go up as usual. Healey has said the Budget will deliver "targeted support for businesses and self-employed people" and will focus on "backing businesses and entrepreneurs" alongside "breathing space" on living costs — but neither statement commits to a number.
One business owner's numbers, and the VAT argument built on them
Taylor is backing Hospitality Ulster's call for a VAT cut on hospitality, pointing out that Northern Ireland sits at the standard 20% rate while the Republic of Ireland charges 9% and much of Europe charges around 10%. "We really need to see a VAT reduction," she said. "Comparing ourselves to the South at 9% and Europe at 10% and we're sitting at 20%, it's not sustainable." Nothing in today's Budget is expected to touch the UK's VAT rate structure for hospitality specifically — it is a Westminster-set, UK-wide rate, and no indication from government sources points to a change landing this afternoon. The point worth taking from Taylor's numbers is narrower and more useful: she has already measured what one wage rise cost her business in pass-through terms, and that is the exercise worth running now, before the next rise is confirmed.
What a repeat wage rise could cost a Northern Ireland business
Take an illustrative Northern Ireland café or bar with ten full-time-equivalent staff on the National Living Wage — the rate that applies to everyone 21 and over, currently £12.71 an hour. Working a standard 37.5-hour week across 52 weeks, that's 19,500 paid hours a year for this group, costing £247,845 in gross pay at today's rate.
| Illustrative 10-staff NI hospitality business, National Living Wage | Hours/year | Cost |
|---|---|---|
| Current wage bill at £12.71/hr (37.5 hrs × 52 weeks × 10 staff) | 19,500 | £247,845 |
| If the next rise repeats last year's 50p (4.1%) | 19,500 | +£9,750 |
| Revised wage bill, before employer NI or pension | 19,500 | £257,595 |
Last year's rise to £12.71 was 50p an hour, 4.1% up on the year before. If this year's increase for the 21-and-over rate repeats that scale — a plausible planning assumption, not a confirmed figure — the same ten staff cost an extra £9,750 a year before a penny of employer National Insurance or pension contribution is added on top. That figure moves on the existing headcount alone, before any growth in staff or sales; it's simply the wage bill moving. A smaller rise for 18-to-20-year-old staff, which is what's being reported ahead of today's speech, would soften that figure for a business with a younger team, but only for the staff on that specific age band — anyone 21 or over on the payroll is on the full adult rate regardless of how the 18-to-20 figure moves.
What this means for your business this week
If you employ anyone on or near the National Living Wage, model the increase now rather than waiting for the headline figure. Use last year's 50p rise as your planning assumption until the real number lands this afternoon, then correct it — a model built two hours early and updated once is more useful than nothing built at all. Our payroll team can run that projection against your actual headcount and hours instead of an illustrative ten-person team. If you run a hospitality business, note that nothing in today's Budget is expected to change the VAT rate you charge — keep budgeting on the 20% rate you already operate at until the Budget documents say otherwise. And check gov.uk's minimum wage page once the Budget documents are published this afternoon, instead of relying on second-hand reporting of the new rate.
For how last April's rise actually broke down by age band, see our piece on the real Living Wage rising to £14.10 an hour, and for what the same cost pressure did to one national chain's own numbers, Claridge's £9.7m loss, broken down.
What's still uncertain, and when you'll know
The actual new rate for each age band is the single biggest unknown, and it will be confirmed in Healey's speech this afternoon. How much smaller the 18-to-20 increase will be, relative to the 21-and-over rate, is reported but not yet an official figure. Stormont's own calculation of what the Budget is actually worth to Northern Ireland — including whether the £525m-to-£1.5bn gap narrows at all — won't be published by the Department of Finance until later in the day, once Healey has sat down. Treat any number you see on social media this afternoon as provisional until it's confirmed on gov.uk or by the Low Pay Commission directly.
Whatever the figure turns out to be, it applies to every Northern Ireland employer with staff on or near the minimum, not just the ones in the news. Getting the payroll cost modelled before 1 April — instead of discovering it on the first payslip of the new tax year — is exactly what our payroll service is built for.