The UK government is under increasing pressure to act. It needs to cover every aspect of the hospitality sector – from pubs to venues to gyms – in those forthcoming reforms to business rates. Even key industry leaders are flagging their concerns about the surge in property valuations and tax hikes. They worry that these trends might endanger their ability to survive in today’s hyper-competitive and economically difficult environment.
Jon Collins, chief executive of LIVE added that it was vital to recognise the live events industry as a whole. He urged policy makers to speed up decisions made in government, most notably over business rates. His remarks coincide with the government’s announcement today of plans to cut tax pubs and hospitality. The Independent Valuation Office, in a move that has left many pubs, restaurants, and cultural spaces facing an existential crisis, has massively hiked up property values.
In November Chancellor Rachel Reeves removed business rate discounts from 75% to 40%. By April, she hopes to have all discounts behind her. This decision has come under fire from elected leaders and many advocates and stakeholders. They contest that the changes would disproportionately affect pubs and hospitality venues that are already struggling to bounce back from the pandemic.
Dame Caroline Dinenage has been outspoken on the suffering of venues, clubs and cinemas. In fact, Ms. Sheppard wrote to the Chancellor at the end of August calling for urgent action to save these spaces that are “already fighting for their lives.”
“Venues, clubs and cinemas up and down the country are already struggling for survival,” – Dame Caroline Dinenage
We urged him to consider the damaging effect that withdrawing support for business rates would have on gyms, pools and leisure centres. Without adequate federal support, he cautioned that communities would face escalating costs and diminished service levels. Without help, they might even surrender their hometown arenas.
“Failure to provide a business rates support package to gyms, pools and leisure centres will lead to higher prices, reduced services, redundancies and in some cases the loss of gyms from our communities,” – Huw Edwards
Landlords and owners of pubs hit by the landlords tax – like junction – getting angrier at the next impending tax increases. In response, over 1,000 publicans have pledged to refuse entry to Labour MPs in their pubs. This act of defiance indicates just how fed up they are with being ignored in the plans—indeed, discussions overall—around financial relief.
Andrew Goodacre, chief executive of an organization representing independent retailers, criticized the government’s apparent oversight regarding support for retailers compared to pubs. He recommended that independent retailers consider taking similar actions to start making noise about their plight.
“Perhaps independent retailers need to follow the pubs’ example and start banning MPs from their premises too,” – Andrew Goodacre
He further noted that independent retailers “face exactly the same challenges as pubs but have been left out of discussions about additional support.” This feeling is echoed by many in the industry who have been left out of the conversation during this pandemic.
Helen Dickinson, chief executive of the British Retail Consortium (BRC), had a similar opinion on the state of affairs. She dubbed the government’s recent announcement a drop in the ocean for tackling deep-rooted problems with the business rates system.
“This latest announcement looks like another sticking plaster on a broken system rather than the more fundamental reform required,” – Helen Dickinson
Recognising these criticisms, shadow business and transport secretary Rachel Reeves accepted that many across all areas of the hospitality sector are suffering. She said that the government is continuing to work in a cooperative manner with industry leaders to better understand the impacts of federal policy changes.
“Now we’re working with the sector to look at the implications of a range of policies and looking at planning and licensing,” – Rachel Reeves
She was previously vocally committed to helping protect pubs and high streets. At the same time, we understood that many businesses continue to face real hurdles.
“I want to support our pubs; I want to support our high streets. That’s why we made the change to the rates. But I recognise that many paths are still struggling and we’re working with them,” – Rachel Reeves
Conversations surrounding how the federal government could and should intervene are happening right now. Our industry leaders remain hopeful, however, for a broader solution that covers all industries affected by these tax changes. Jon Collins’ call for inclusivity is a reminder that as certain areas receive attention from policymakers, others must not be left behind.
“If the government is preparing a U-turn on business rates for pubs, it must not leave live events and arenas behind.” – Jon Collins
The future remains uncertain for pubs, venues, and leisure facilities as they navigate these changes. The next major government announcements will be key in shaping how these sectors shift and thrive under the changing economic climate.