Calls for hospitality support grow as business rates outcry deepens
Calls for the government to extend its rumoured support package for pubs to the entire hospitality industry grew on Monday, after a string of data releases laid bare the bleak outlook for UK venues amid fresh polling that reveals enormous public support for the embattled sector.
According to the latest Morning Wire/Freshwater Strategy poll, 70 per cent of British voters believe hotels, restaurants and other struggling hospitality businesses should be included in any support measures ministers are preparing to hand pubs.
A separate piece of analysis from industry body UK Hospitality also found over 2,076 hospitality venues will close in the next year unless the government introduces a solution to its ill-fated business rates shake-up that supports the entire sector.
Ministers are poised to unveil a raft of measures to alleviate the strain put on pubs by an overhaul to business rates announced at last year’s Autumn Budget.
The shake up, which reassessed the level of property tax paid by businesses, handed the hospitality and retail industries a 5p cut, in a move the Chancellor heralded as bringing the overall rate of taxation down to its lowest since 1991.
But because of a simultaneous reassessment of venues’ valuations and the culmination of pandemic-era support, the average hospitality firm’s business rates bill is in fact set to rise by an average of 94 per cent in three years.
Hospitality business rates revaluation caught ministers off guard
Business secretary Peter Kyle admitted the government was caught off-guard by the revaluation. He told Times Radio: “During the Budget, we actually lowered the overall rate for business rates, but an independent reviewer then reviewed the rate valuation of each property. We didn’t have access to that information before making these decisions.”
The reforms have triggered a historic, industry-wide outcry that resulted in thousands of landlords – including the celebrity publicans Jeremy Clarkson and James May – banning Labour MPs from their premises over Christmas.
The rear-guard effort has forced ministers to hastily put together a set of measures to support Britain’s struggling pubs. An announcement on what the package will entail is expected this week, but rumours of the impending U-turn have triggered a barrage of calls for any support to be extended to the wider hospitality industry.
“Staggering increases to business rates will affect the entire hospitality sector and without a hospitality-wide solution, we will see significant business closures,” said Kate Nicholls, chair of UK Hospitality.
“We need a hospitality-wide solution that averts damaging business rates hikes in April,” she added.
UK Hospitality’s analysis showed the average hotel will see its business rates increase by over 115 per cent over the next three years, pushing an estimated 574 hotel businesses to the wall by the end of 2025.
Some 963 restaurants also face closure, prompting the lobby group to call demand ministers hand the ailing sector a 20p discount, the maximum amount they can under fresh powers handed to them last year.
Morning Wire’s Freshwater Strategy polling found over 58 per cent of Brits’ were concerned or very concerned about the health of local pubs.
The Treasury was contacted for comment.