In addition, the secondary threshold will be cut from £9,100 to £5,000 which will see higher payments for employers as more staff become liable for NI payments.

The rise will be offset for up to 900,000 small employers with the doubling of the employment allowance to £10,500 from the current £5,000 cap.

This measure will raise an eye-watering £23.8bn in the 2025-26 tax year alone, filling the initial fiscal hole identified by Reeves when Labour came to power in July.

The rise in employers’ NI will come into effect in April 2025 giving employers time to budget for the increases. However, it will affect the majority of businesses with an unavoidable charge on all PAYE employees.

However, there will be some relief for smaller businesses with an increase in the employment allowance from £5,000 to £10,000 from April 2025.