‘Only time will tell’ if Gov help goes far enough

By Gary Lloyd

- Last updated on GMT

Government help announced: scheme welcomed but details and a longer-term plan are needed (credit: Getty/Dimensions)
Government help announced: scheme welcomed but details and a longer-term plan are needed (credit: Getty/Dimensions)

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Sector leaders have welcomed the initial details of the Government’s plan to tackle energy costs in the on-trade but say “only time will tell” if the scheme goes far enough.

On Wednesday (21 September), business secretary Jacob Rees-Mogg unveiled the support in the form of the Energy Bill Relief Scheme that he said will protect businesses, charities and public sector organisations from rising energy costs as the government works with suppliers to reduce wholesale energy costs and the hefty hikes in bills for UK businesses.

British Beer & Pub Association chief executive Emma McClarkin said: “We welcome this very significant and critical intervention by the Government. It will be a lifeline for many pubs and brewers this winter.

“It is crucial business owners can easily understand what discount they will be receiving so they can effectively plan ahead and the requirement for security deposits to enter new contracts must be removed as a barrier to fair supply.”

Longer-term plan needed

McClarkin continued: “While this announcement has helped businesses to breathe an initial sigh of relief as they head into this critical period, more support is needed to tackle the cost of doing business and we need a plan beyond the next six months.

“Our industry is one of only a few that supports jobs and livelihoods in every single part of the UK, and we have the potential to deliver growth in every single community we serve. On Friday (23 September), the chancellor must take steps to address the cost of doing business, by reducing the tax burden on our sector, allowing pubs and brewers the chance to not only survive this winter, but remain at the heart of local economies and their communities for many years to come.”

Sacha Lord, the night-time economy adviser for Greater Manchester, added: “I’m pleased the economic importance of pubs and the hospitality sector is finally being recognised and that support is being pledged beyond this initial six-month period. These plans may go some way to staving off the redundancies we have been expecting across the sector.

“However, only time will tell if the Government has gone far enough. Even with this help, businesses will still be paying more than they’re used to, and off the back of the pandemic, the real concern is whether they can afford to continue trading even with the support being offered.”

Clarity needed this week

Punch Pubs & Co chief executive Clive Chesser applauded the announcement “at a time of existential crisis for the hospitality sector”.

He added: “We must also remember that while an energy price cap will help to ease some of the specific challenges over the next six months, this crisis is combined with other extreme cost increases and dramatically reduced consumer confidence and spending power, meaning that further support is needed if it is to be truly effective in preventing pub closures and unimaginable job losses. The pressure on businesses, both large and small, remains unrelenting.”

He urged Government to deliver a wider package of investment in the form of an immediate cut in VAT of at least 10% (for all products) as well as a business rates holiday for all hospitality premises and said: “A strong and sustainable economic recovery rests on the foundations of a robust and reinvigorated hospitality sector.”

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