Minimum wage rise angers trade
Licensees have slammed Government plans to increase the minimum wage - saying the rise could make their businesses unviable.
The Government has rubber-stamped plans to increase hourly pay by nearly 6% from £5.05 an hour to £5.35 from October. The minimum wage has risen by a staggering 48.6% since its introduction at £3.60 in 1999 and licensees say the latest rise could be the tipping point.
Host Graham Rowson em-ploys 10 members of staff at Punch outlet the Plungington Tavern in Preston, Lancashire.
He said: "This is another nail in the coffin. Everything is going up yet we can't put beer up any more. I have to pay all of my staff the minimum wage and my net profit at the minute is next to nothing. Beer would have to be about £3.00 a pint to make any money with this wage increase."
The rate for 18 to 21-year-olds will also rise from £4.25 to £4.45 and 16 to 17-year-old workers will benefit from a 30p rise from £3.00 to £3.30 an hour.
Ann Basford, licensee and proprietor of the Plough Inn at Manston, Dorset, said the implications would be devastating for her business.
"We employ 30 people and to increase all of their wages would put us under. We will have no choice but to lay some staff off." Linda Hampshire at Punch outlet the Blacksmiths Arms in Little Clacton, Essex, pays her staff above minimum wage.
She said: "Our wages have a lot to do with the location of the pub and I just wonder where the Government thinks all this extra money will come from - especially for operators who cannot afford to pay above the minimum wage."
Medium-sized operators said they will also feel the pinch. London-based Puzzle Pub Company chairman Tom Gill said: "Our concern is that the rise is greater than the rate of inflation and with everything else going up - this is just another brick in the wall."
Association of Licensed Multiple Retailers chief executive Nick Bish said: "The national minimum wage is here to stay. The problem is the rate - the increase is above inflation which puts extra pressure on operators. Ideally, we would've liked the Government to keep the increase in line with retail inflation."
British Beer & Pub Associa-tion director of communications Mark Hastings agreed that the rate of increase was too high.
"The vast majority of operators pay above minimum wage anyway, so it will not have a huge impact. However, this rise should be a cautionary signal that enough is enough. If the minimum wage continues to escalate at this rate it will damage the trade."
In support of the minimum wage, Trade & Industry Secretary Alan Johnson said: "It's right that at a time when our economy is generally strong - with the longest-ever period of sustained growth and nearly 2.4 million more jobs than in 1997 - that we continue to help those who get paid the least."
