Sainsbury’s has revealed plans to cut more than 3,000 jobs.

The supermarket said the move was a bid to save money ahead of a £140m leap in costs from budget tax measures, due to come into force within weeks.

Head office and senior management roles are among those affected, the chain said, adding that the cost-saving drive would also result in the closure of its remaining cafes, hot food, patisserie, and pizza counters.

All the proposals, Sainsbury’s added, were subject to consultation.

Chief executive Simon Roberts said: “We are facing into a particularly challenging cost environment which means we have had to make tough choices about where we can afford to invest and where we need to do things differently to make our business more efficient and effective.”

He made the announcement despite the company’s decision, a fortnight ago, to award inflation-busting pay rises to store workers across the business, which also includes Argos.

Mr Roberts is among business leaders to have publicly spoken out after October’s budget put firms on the hook for the bulk of £40bn in tax increases.

He warned then that additional costs would result in higher prices for customers as the chain did not have the “capacity to absorb” a “barrage of costs”.

Sainsbury’s, he explained, was facing an additional annual bill of £140m from April to cover the cost of additional employer national insurance contributions alone.

Industry bodies have widely spoken of how higher costs will choke investment and jobs.

Cafes are due to shut at the following locations:

Fosse Park, Leicestershire

Pontypridd, South Wales

Rustington, West Sussex

Scarborough, North Yorkshire

Penzance, Cornwall

Denton, Greater Manchester

Wrexham, North Wales

Longwater, Norwich, Norfolk

Ely, Cambridgeshire

Pontllanfraith, South Wales

Emersons Green, South Gloucestershire

Nantwich, Cheshire

Pinhoe Road, Exeter, Devon

Pepper Hill – Northfleet, Kent

Marshall Lake, Solihull, West Midlands

Rhyl, North Wales

Lincoln, Lincolnshire

Bridgemead, Swindon, Wiltshire

Larkfield, Aylesford, Kent

Whitchurch Bargates, Shropshire

Sedlescombe Road, Hastings, East Sussex

Barnstaple, Devon

Dewsbury, West Yorkshire

Kings Lynn Hardwick, Norfolk

Truro, Cornwall

Warren Heath, Ipswich, Suffolk

Godalming, Surrey

Hereford, Herefordshire

Chichester, West Sussex

Bognor Regis, West Sussex

Newport, South Wales

Talbot Heath, Dorset

Rugby, Warwickshire

Cannock, Staffordshire

Leek, Staffordshire

Winterstoke Road, Bristol

Hazel Grove, Stockport, Greater Manchester

Morecambe, Lancashire

Darlington, County Durham

Monks Cross, Huntington, North Yorkshire

Marsh Mills, Plymouth, Devon

Springfield, Chelmsford, Essex

Durham, County Durham

Bamber Bridge, Lancashire

Weedon Road, Northampton, East Midlands

Hempstead Valley, Kent

Hedge End, Hampshire

Bury St Edmunds, Suffolk

Thanet Westwood Cross, Kent

Stanway, Colchester, Essex

Castle Point, Essex

Isle of Wight

Keighley, West Yorkshire

Swadlincote, Derbyshire

Leicester North, East Midlands

Wakefield Marsh Way, Wakefield, West Yorkshire

Torquay, Devon

Waterlooville, Hampshire

Macclesfield, Cheshire

Harrogate, North Yorkshire

Cheadle, Greater Manchester

Primark’s owners have reported a rare plunge in retail sales during the crucial Christmas quarter, underlining the challenges facing even discount retailers in the tough economy.

Associated British Foods (ABF) reported a like-for-like sales decline of 6% for Primark in the UK and Ireland over the 16 weeks to 4 January.

It said that while sales within the fashion-dominated business had held up over the festive season, the build up to December was mired by weak consumer demand and warm weather.

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ABF said that as a result of the drag, it was now expecting “low single-digit” sales growth for the brand in 2025, down from a forecast for mid single-digit growth made in November.

That was despite growth in key emerging markets of the US, France, Spain, Italy and Portugal.

The UK and Ireland account for almost half of Primark’s revenues.

The company’s bleak update chimes with the findings of an industry survey, released earlier on Thursday, which stated that the outlook for UK consumer confidence had plunged to a new low.

The British Retail Consortium’s (BRC’s) latest Sentiment Monitor showed declines in expectations for both the economy and personal finances.

The retail lobby group has been among the loudest voices in opposing Chancellor Rachel Reeves’ decision to pile £25bn of taxes on business in the budget – the vast majority through employer national insurance contributions.

The measures do not kick in until April but major employers, such as supermarkets and other major chains, have widely warned that the tax grab will result in lower investment, jobs, wages and higher prices to help offset the impact.

The most recent employment figures pointed to an acceleration in job losses among payrolled employees during December.

While highlighting the deterioration in consumer confidence, the BRC did add that a significant contribution was likely to have come from a traditional post-Christmas easing when many shoppers tend to tighten their belts.

BRC chief executive Helen Dickinson said of the outlook: “As the government warns of tough times ahead, it is little surprise that the public have caught the January blues.

“Consumer confidence in the economy fell to a new low, with concerns most pronounced among older generations.”

She added: “On top of this challenging market backdrop, retailers are facing £7 billion in additional costs from the budget and new packaging levy.

“With retailers’ tight margins leaving little scope to absorb more costs, many are warning of price rises and job cuts in the coming months.

“To mitigate this, and shore up investment in shops and entry level jobs, the government must ensure that no shop ends up paying a higher business rates bill because of its proposed reforms.”

The Labour government has placed economic growth at the top of its list of priorities but the economy has stagnated since the election, with consumers continuing to grapple a host of higher bills such as from household energy.

Shares in ABF were down by more than 2.5% while some other consumer-facing stocks also fell in sympathy.

Russ Mould, investment director at AJ Bell, said of the update: “If Primark is struggling, you know the UK retail sector is in trouble.”

He added: “When Primark says UK sales are weak, you know there has been a change in shopper behaviour. People might still be visiting its stores but they are being more selective and that’s a problem when the business model is built on shifting high volumes of goods.

“Retailers love to blame the weather when things don’t go well. While the UK autumn was relatively mild, winter has been bitterly cold so Primark should still have been able to shift plenty of jumpers and coats in recent weeks, albeit the last couple of weeks fall outside of the reporting period to 4 January for the trading update.”

Chancellor Rachel Reeves has indicated she will overrule environmental objections to a third runway at Heathrow in order to prioritise economic growth, a position likely to bring her into conflict with colleagues including energy secretary Ed Miliband.

Speaking as she began a 48-hour pitch to international investors at the World Economic Forum in Davos, Ms Reeves said she would back infrastructure projects even where they are unpopular.

The expansion of Heathrow has been debated for almost 20 years but despite the consistent support of business groups and a consensus it would boost economic activity, environmental and political objections have prevented it.

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Asked directly if she would now put the runway, along with expansion at Gatwick and Luton ahead of the UK’s net zero commitments, Ms Reeves said: “I’m not going to comment on speculation, but what I would say is when the last government faced difficult decisions about whether to support infrastructure investment, the answer always seemed to be no.

“We can’t carry on like that, because if we do, we will miss out on crucial investment here into Britain. You’ve already seen a number of decisions, including on Stansted and City Airport, on energy projects, on transport infrastructure, because we are determined to grow the economy.”

The chancellor’s trip to Davos comes with her economic program under increased scrutiny after a bumpy start to the new year, including a rise in borrowing costs and data showing the economy has stagnated since the election.

Business groups have also questioned the increase in employment costs in the budget, but Ms Reeves insisted the UK is competitive internationally, and has a strong case to make to international markets.

“If you look at the UK’s taxation compared with countries around the world, we remain highly competitive, we have the lowest corporation tax in the G7. Amongst European countries, we have some of the lowest employment taxes, So Britain is an attractive place to invest.”

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Politics may stand in the way of economics when it comes to airport expansion

Ms Reeves also hailed the removal of the chair of the Competition and Markets Authority, a regulator regularly blamed for unnecessarily slowing down deals, as a sign she was serious about growth.

“We’ve got huge strengths as a country and this government is reforming the planning system, reforming the regulation system, making it easier for businesses to get things done, all with the purpose of making working people better off,” she said.

UK not a target

The chancellor said she did not think the UK would be a target for tariffs threatened by president Donald Trump, largely because Britain has a trade deficit with America, and that she planned to meet the incoming Treasury secretary once he is confirmed.

Growth trade offs thrown into stark relief

Paul Kelso

Business and economics correspondent

@pkelso

The saga of a third runway at Britain’s biggest airport encapsulates, perhaps better than any, the trade-offs required to prioritise growth.

Airport expansion is a proven vehicle for growth. Heathrow’s current investors are desperate to expand, despite the cost of complications.

But for a decade political opposition, from Boris Johnson to Sadiq Khan, has stood in the way.

Of course, there are sound environmental arguments against that a government committed to net zero by 2050 might consider, and Ed Miliband can be expected to make.

But if growth really is the priority then at some point they have to choose.

Given the multiple avenues for objection and the strength of feeling inside and outside cabinet, Ms Reeves’ position does not mean that a runway is now more likely than it was six months ago.

It may however be less unlikely, and as a short-term signal to the investors she is courting in Switzerland, that is a start.

“I believe in free and open trade, and I’ll be making that case to my counterparts in the United States. I’m excited about the opportunity to work with the new Trump administration.

“Trade between the UK and the US is worth £300bn a year, a million Brits work for American firms, a million Americans work for British firms, so our economies are closely intertwined, and I look forward to enhancing and strengthening that relationship.”

Privately some international investors and British company bosses in Davos have questioned the clarity of Ms Reeves’s message, but she has received public support from significant companies.

Bill Winters, the chief executive of bank Standard Chartered, told Sky News: “I think the chancellor is doing the right thing in terms of putting the sign out that the UK is open for business.

“She’s also made very clear statements about the fact that we’re going to reduce some of the red tape set back to regulation in a way that’s safe and sound. Exactly how that’s going to work through, we’ll see. So I’m encouraged, but obviously, she’s got a huge, huge challenge.”