Meanwhile, shadow Chancellor of the Exchequer Rachel Reeves has suggested extending help for hospitality businesses. She is especially committed to rescuing pubs to be hit by an upcoming hike in business rates. Speaking on her recent visit to BBC Breakfast, Reeves emphasized the total tsunami of hardship the hospitality industry is going through. She noted that the Covid-era business rates relief will cease in April, increasing costs and pressure on businesses.
Reeves expressed understanding that the hospitality industry is hurting as they are facing huge hikes in their business rates. In particular, as she pointed out, pubs are going to be the ones hit hardest first. “I think that people can see that the biggest impact and the biggest concern right now is around pubs,” she stated. This announcement draws attention to the degree that she has prioritized the pub industry, even as the financial squeeze increases.
Reeves did not elaborate as to what support we might expect, especially in relation to smaller hospitality businesses outside of pubs. Ultimately, she said, the government’s dedication to a balanced approach is what mattered. “As that transitional relief comes to an end, although we’ve put in £4.3bn over the next three years, we need to make sure that we do that in a balanced way that particularly supports our pubs and the hospitality sector,” Reeves explained.
Pub backers must have understood this, because last week – as broken by the BBC – the Treasury was said to be preparing more help for pubs. This announcement will land at a very opportune moment, as the hospitality industry contends with sweeping rate hikes in general. Small pubs will be hit with an eye-watering 76% increase to their rates bills over the next three years. Hotels could face even bigger increases—up to 115%. These cumulative large percentage increases have created alarm among industry stakeholders about the long-term feasibility of many businesses.
Kate Nicholls, Chief Executive of Hospitality UK, welcomed Reeves’ acknowledgment of the broader hospitality sector’s challenges, stating, “It’s good to see recognition of wider hospitality and that she is talking about support beyond pubs.” Her comments demonstrate a hopefulness that other parts of the industry will be similarly included in future relief/support packages.
The forthcoming revaluation of business rates is set to make things even worse for hospitality businesses. As they prepare for these changes, many in the industry are looking towards the government for clear guidance and assistance to navigate this challenging landscape.