Knife edge: Hospitality calls on government to serve up change
Industry insiders – from chefs to independent brands – are calling on the Chancellor to provide real support in next week’s Budget, writes Carys Sharkey
“I’d rate it one out of 10. Frankly, it’s been negligible”.
Ask any chef across the country how they would rate this government’s support for the hospitality sector and you’ll be hard-pressed to find someone with something positive to say.
Atul Kochhar, a pioneer of Indian fine dining in the UK, does not mince his words, and speaks for many chefs with his dire rating of Labour’s tenure. He goes on to add:
“The hospitality sector has faced and continues to face enormous challenges, we’ve been hit hard with 360 degree rising costs and regulatory pressures.”
Ahead of next week’s make or break Budget, figures across the industry are raising the alarm and putting out a last-ditch call to the Chancellor for service. The stats paint a stark picture of a sector bearing the brunt of crippling cost pressures. ONS data shows hospitality is set to lose 111,000 jobs by the end of this month – more than half of all UK job losses since the last Budget.
As more pubs and restaurants are forced to call last orders, others are weighing up how feasible it is to carry on. Hospitality, which has always been a sector of gruelling work and razor-fine margins, is entering a “critical juncture”, says Tom Cenci, executive chef at Soho’s Nessa. As costs slice deeper into bottom lines, many are wondering if next week will deliver the fatal cut.
Rising costs across the board
“Rising costs across the board (ingredients, labour, energy, rent) are squeezing margins to unsustainable levels. Many established venues have closed, and others are operating on a knife-edge,” Tom points out.
The impact of restaurants and pubs closing across London is devastating. From iconic spots like Claude Bosi’s Bibendum to cultish-local favourites like Silo or The Gun, this year has seen its fair share of notable closures – a trend that only risks getting worse.
Many chefs and restaurateurs share the same fear, that independents are going to be increasingly subsumed by larger chain groups, and that London’s food scene faces a slip into the homogeneous. One person spearheading the fight against such a move is Imme Ermgassen, industry insider and co-founder of non-alcoholic aperitif Botivo.
“No one wants to go to every single pub, every festival, every bar and drink the same things and have the same experiences. Part of the richness of the UK is we have this tapestry of different cultures that comes together and offers such a unique diverse experience and what we’re seeing is, because of this pressure that hospitality is feeling, they’re having to make deals and that’s creating a massive homogenisation.”
‘Completely let down by government’
Imme is well-versed on the unease that has plagued the sector following the crushing Budget last year, and can only conclude that “the hospitality industry has been completely let down by the government.”
An ardent supporter of the sector, the Botivo boss argues that hospitality is critical “infrastructure” to the UK and a springboard for young people entering the jobs market.
“As an independent brand, what you see increasingly is restaurants and bars unable to keep the lights on… [it has] a massive impact on the next generation of young people, how people are learning life skills, how they’re learning how operations work, how they’re learning how to live outside of schools, how they’re moving into independent living.”
Imme says the government has offered empty gestures when the industry is crying out for real support. One such announcement, Imme says, is Labour’s move to extend pub opening hours to boost London’s nighttime economy.
“I haven’t spoken to anyone that’s excited about the extended hours. They’re just like ‘Well, they’ve completely ignored everything that we’ve been saying’”.
So what does the sector actually want to see next week? The chair of industry body UKHospitality, Kate Nicholls, offers up the full menu:
“If the government wants to get people back into work and revitalise high streets, it needs hospitality firing on all cylinders, but right now, we’re being taxed out. We urgently need action and are calling on the Government to lower business rates to revive high streets, fix NICs to boost jobs, and cut VAT to drive investment. Anything less risks more closures, higher prices for consumers, and the loss of the vibrant hospitality that defines our communities and our capital. Hospitality is ready to drive growth and recovery, but we need the backing and support to do so.”
It’s a big ask of a government that has done very little to endear itself to the hospitality sector, and many are bracing for pain rather than relief.
People making ‘huge sacrifices’
A Government spokesperson said: “We’re cutting the cost of licensing, lowering business rates and helping more hospitality businesses offer pavement drinks and al fresco dining, on top of cutting alcohol duty on draught pints and capping Corporation Tax.”
Restaurants, pubs and cafes are woven into the fabric that stitches London together and a vital part of what makes it so attractive to both residents and visitors. The diversity of the food scene, from street food to triple-Michelin starred restaurants, is one of the best in the world, and every closure constitutes a small disaster.
As Imme concludes: “People are willing to work their asses off and make huge sacrifices to keep the lights on because they feel so passionate about it and yet they’re getting to the point where they can’t do that, and when people do everything they can in their power to nurture and create something they totally believe in but are not able to and they’re being forced to close, that’s when you know you’re in real trouble… this is just the beginning and I think there’s a huge feeling of now’s the time or it’s always going to be too late.”