UKHospitality and a coalition of leading hospitality businesses have written to Chancellor Philip Hammond to call for targeted support in this month’s Budget that will protect the valuable economic contribution the sector makes to the UK.
The hospitality industry employs 3.2 million people across the UK and contributes £130bn to the economy – more than automotive, pharma and aeronautics combined. It ranks as a top 7 employer in every region of the UK, ranking the third highest in some regions and accounts for up to 11% of the regional workforce.
The letter offers a stark warning to the Chancellor of a growing crisis in hospitality and the high street, which has resulted in businesses failing, opening plans scrapped, operating margins eroded, thousands of jobs lost and investment put on hold.
The letter states: 'On a daily basis the British public are witnessing the impact this is having on their high streets and their local restaurants or pub. The health of the high street is often how consumers and voters judge the health of the economy, regardless of the national picture, and what they are seeing and experiencing is damaging consumer confidence.
'We believe that we are only at the start of the crisis in hospitality. It is vital, therefore, that steps are taken at the forthcoming Budget to support and sustain this engine of economic growth and the contribution it makes.'
The letter includes five clear Budget asks of the Chancellor:
1. Introducing an online revenue tax to freeze business rates increases and introduce enhanced hospitality rate relief over the next two years ahead of the next revaluation to deliver your pledge to level the playing field between ‘bricks and mortar’ and ‘clicks and mortar’ entrepreneurs ahead of root and branch reform – hospitality generates 5% of GDP but pays 20% of all rates, which is unsustainable
2. Doubling the NIC threshold for employers to safeguard youth employment, training and take-home pay – half of all operating costs in hospitality are labour related and we want to have the ability to deliver our pledge to make hospitality the best rewarded sector in the UK and improve productivity
3. Ensure future NLW rates and structure are set independently by the Low Pay Commission, with evidence-based consultation with business taking account of the impact on jobs, the wider economy and take-home pay
4. Re-introduce hospitality capital allowances – and introduce a business rate moratorium after refurbishment – to incentivise regeneration and investment ahead of root and branch reform of rates
5. Implement the Northern Ireland VAT review on tourism services and extend it to the whole country as well as freezing alcohol duties to promote exports, improve the balance of trade and create new jobs across the country.
UKHospitality Chief Executive, Kate Nicholls (pictured) said, “We want a grown-up partnership with Government based on an inclusive and integrated policy framework that champions the contributions this sector makes to the UK economy and society. We need a Budget which supports us in the vital role our business will play in delivering a strong economy, productivity and job growth as we go through the 4th industrial revolution and as we exit the EU.”
Signatories to the letter are: All Our Bars, Anglian Country Inns, Azzurri, Bartlett Mitchell, Burger King, Butlins, Casual Dining Group, Deltic Group, GC Mallen, Greene King, Haulfryn Group, Loch Melfort, Masala World, Merlin Entertainments, Mitchell & Butlers, New World Trading Co, Novus Leisure, Oakman Inns, Pizza Express, Pizza Hut Restaurants, Queensferry Hotels, Revolution, Shearings, Stonegate Pubs, The Pub People Company, Thorley Taverns, Thurlestone Hotel, Wagamama, Whitbread, Whiting & Hammond, YO! Sushi, along with Hospitality Ulster and the Scottish Tourism Alliance.