Government urged to take 'critical action' to protect hospitality jobs and growth

By Claire Churchard contact

- Last updated on GMT

Protect and serve: the hospitality sector generates £63bn to the economy
Protect and serve: the hospitality sector generates £63bn to the economy

Related tags: Economics

The Government must protect the hospitality sector’s ability to create jobs and invest in the UK ahead of the Budget on 22 November, according to the ALMR.

In its pre-Budget submission, the Association of Licensed Multiple Retailers (ALMR) emphasised that the eating and drinking-out sector is a major asset to the UK economy and has the ability to drive further growth.

However, it said that this value could be undermined if a £213m tax rise, via hikes in business rates and excise duty, goes ahead in the Budget next month.

Hospitality sector value

The UK’s eating and drinking-out sector:

  • Generates £63bn in economic activity
  • Adds £23bn to the UK’s GDP
  • Employs 1.6m people, which equals around 7% of all private sector employment
  • Has created 30% of all net new employment in the past year

Protect jobs and growth

ALMR urged the Government to protect existing employment and growth by minimising the cost pressures on businesses already struggling with falling consumer and investor confidence and the uncertainty caused by Brexit.

It set out the short-term support and longer-term policies it would like the Government to offer pubs, restaurants and nightclubs.

Short-term action:

  • Major business rates reforms
  • A freeze, or at least a cap, in the rate that is used to calculate the business rates multiplier for April 2018 (currently it is pegged to the retail price index)
  • A rise in the pub-specific relief to £5,000 a year as well as broadening it to include the wider eating and drinking-out sector
  • Freeze alcohol duty excise rates
  • Commitment to follow the Low Pay Commission’s recommendations on setting the minimum wage

Long-term policy:

  • A future immigration policy that recognises the eating and drinking-out sector’s workforce
  • Produce a post-Brexit tax and regulatory regime that promotes growth and allows the sector to compete globally
  • Outlining its intention regarding VAT for the hospitality sector in Northern Ireland and in a post-Brexit environment

ALMR chief executive Kate Nicholls said: “The eating and drinking-out sector is currently doing some fantastic work, revitalising high streets and driving employment and growth; but these businesses are not immune to pressures.

"The sector is facing a massive £213m tax hike through increases to rates and duty, which will have a considerable impact on investment and growth.

“If the Government wishes to lay the foundations for a strong UK economy that will prosper over the coming decades, a great first step would be to act to support those businesses that play a significant role in the fortunes of local economies in every part of the country.”

Related topics: Legislation

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