John Lewis Partnership, the employee-owned British retailer, is expected to announce a cut in its staff bonus this week, as it counts the cost of shoring up its pension scheme.

Analysts are forecasting a payout of 14-15 per cent of staff salaries, down from 17 per cent last year.

By sharing its profits with 85,500 staff, known as partners, through an annual bonus, John Lewis has been lauded by politicians as a model of caring capitalism. However, Nick Bubb, an independent retail analyst, has forecast the group will make an annual profit before exceptional items of about £370 million (€449.6 million). Although this is up from £343 million, when restated to account for changes to the way pensions are accounted for, it is a reduction on the £410 million announced in March 2013.

“Barring a miracle on the payout ratio, that is likely to mean it will be impossible to maintain last year’s 17 per cent bonus . . . given the increased cost of servicing the pension fund,” Mr Bubb said. – Copyright The Financial Times Limited 2014)