The Government has launched a consultation into further changes to business rate discounts for pubs and other ratepayers across England. The previously generous 75%-off fare has now been hacked to 40%. This decision has sparked a firestorm of protest within Britain’s pub industry and legislators. They are now out insisting on more radical, inclusive steps to save the crisis facing diverse spoke venues, clubs and cinemas. The chancellor provided no discounts at all from the old fares on that day. This ruling has touched off an even greater panic among the hospitality industry over a coming “hospitality apocalypse.”
In reaction to these shifts, more than 1,000 pubs have stepped up to the plate and made a daring pledge. They have literally barred Labour MPs from their property. This protest illustrates the growing anger being felt across the entire industry. Many feel that government policies have failed to help support them enough to operate. Andrew Goodacre, chief executive of a notable industry organization, remarked on the situation:
“Perhaps independent retailers need to follow the pubs’ example and start banning MPs from their premises too.” – Andrew Goodacre
Discontent is brewing among the riding public. Most importantly, they expect the government to reverse their hike in business rate bills that has been hitting pubs hard. The expected backtrack follows a months-long campaign of letters from industry supporters. Dame Caroline Dinenage, one of them, wrote to the chancellor to draw attention to the “dire situation” which music venues, nightclubs and independent cinemas across the country are in.
“Venues, clubs and cinemas up and down the country are already struggling for survival,” said Dame Caroline Dinenage, emphasizing the urgent need for government intervention.
Jon Collins, the chief executive of music venue body LIVE articulated these sentiments brilliantly. He called on the government to put the needs of live events and arenas first if it is indeed considering a business rate cut for pubs.
“If the government is preparing a U-turn on business rates for pubs, it must not leave live events and arenas behind.” – Jon Collins
In fact, industry leaders have never been so loud in their alarm. Huw Edwards, the chief executive of ukactive was equally blunt. Without a concerted business rates support package for all gyms, swimming pools, and leisure centers, we may be looking at a situation with higher prices and potentially closures on the horizon.
“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
Helen Dickinson, chief executive of the British Retail Consortium (BRC), panned the recent announcement as a “beyond half-hearted” move. She described it as “another sticking plaster on a broken system rather than the more fundamental reform required.” Dickinson stressed the importance for the Treasury to provide clear guidance on how they got to these adjustments. He underlined the fact that the sector requires greater clarity on the non-military support the Prime Minister has pledged.
“The Treasury needs to be open about how it decided on the changes, while the sector desperately needs more details on the alternative support promised by the Prime Minister.” – Helen Dickinson
Rachel Reeves, shadow chancellor of the Exchequer, has seen the writing on the wall. She highlighted positive government moves to reduce tax rates for pubs and the hospitality sector. Businesses of all types are still struggling. She signaled an openness to continue discussions with stakeholders to assess the immediate and long-term impacts of new policies affecting the intersection of planning and licensing.
I truly want to protect our pubs. I truly want to protect our high streets. That’s why we decided to take a step back and make the rates more friendly. I know that a lot of these corridors are still in the fight and we’re doing our best to fight with them, Reeves said.
The Independent Valuation Office’s recent assessments have further complicated matters by increasing perceived property values for pubs and hospitality venues. Pubs owners are worried sick about the impact of the increased rateable value. They are concerned that increasing business rates will increase the financial pressure that they are already facing.
As the reauthorization of the law looms and debates around potential reforms go on, key industry stakeholders are largely hopeful that relief measures will materialize. Yet they all point to the essential demand for a coordinated, national-level strategy. This more comprehensive approach should go beyond just helping pubs to include live events and gyms threatened by eviction.