SLTA: sector crisis is ‘worse than the pandemic’

By Gary Lloyd

- Last updated on GMT

Warning: SLTA boss Colin Wilkinson says the damage is already done
Warning: SLTA boss Colin Wilkinson says the damage is already done

Related tags Finance Legislation Social responsibility Health and safety Licensing

The Scottish Licensed Trade Association (SLTA) has warned the crisis for hospitality businesses struggling with the cost-of-living crisis plus spiralling energy and utilities bills is “worse than the pandemic”.

Despite welcoming new Prime Minister Liz Truss’s announcement to cap average household energy bills at £2,500 a year from October for two years and pledging a six-month package for businesses providing “equivalent support”, SLTA managing director Colin Wilkinson warned: “Sadly the damage is already done. [Thursday’s] announcement has not gone into enough detail on what ‘equivalent support’ will mean and does not help businesses already planning to close or reduce their opening hours over the winter period.

“This should have been a priority for Westminster months ago when experts were ringing alarm bells and warning of the juggernaut that was on its way. All help is, of course, welcome but Liz Truss is only really giving us a sticking plaster to fix a broken leg.

“Hospitality businesses also urgently need a reduction in VAT and rates reduced or frozen. We eagerly await the chancellor’s fiscal statement later this month but suggestions of a cut in corporation tax will only help those businesses making a profit – the rate of inflation is at its highest level for years with the Bank of England warning it will continue on an upward trajectory.”

Untenable position

Wilkinson added reports suggesting pubs could be forced to increase the cost of a pint to £15 or £20 to survive through winter is untenable for both businesses and operators, and the Scottish and UK Governments need to work out how to help the hospitality sector, which hasn’t yet recovered from the pandemic and continues to incur extra costs in finding staff who left the industry during the pandemic and because of Brexit.

“The current situation, for many businesses, is worse than the pandemic,” he declared. Wilkinson said he awaits the full details in due course to the declaration by Truss that further support will be targeted at “vulnerable industries” after the initial six-month support period.

Meanwhile, he expressed concern about the Scottish government introducing legislation that will allow local authorities to tax tourists. Wilkinson said: “This is absolutely the wrong time to be pushing this through – a time when many businesses are already on the brink and talking about closing down over the winter.”

Reputation could be damaged

“The Local Visitor Levy should not go ahead and we believe imposing additional costs on visitors to Scotland will have a negative impact on hospitality businesses and potentially damage our nation’s reputation as a welcoming tourist and visitor destination.”

Additionally, he expressed dismay over the Scottish government’s determination to implement a deposit return scheme (DRS) next summer, pointing to the widely-held concerns surrounding the complexity of the scheme and questions around the secure storage of containers and glass breakages.

“Both the DRS and Local Visitor Levy should not be priorities when businesses are throwing so much time and effort into dealing with current and much more pressing issues,” he said, responding to both announcements in the Programme for Government outlines by First Minister Nicola Sturgeon earlier this week.”

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