Operator warns pubs 'can't absorb' increase to NLW

By Rebecca Weller

- Last updated on GMT

Cost and consequence: operator warns pubs will not be able to absorb proposed increase to NLW (Credit: Getty/georgeclerk)
Cost and consequence: operator warns pubs will not be able to absorb proposed increase to NLW (Credit: Getty/georgeclerk)

Related tags Legislation Government Finance

Pubs will not be able to “absorb” the increase to the National Living Wage (NLW) as the sector continues to face “unrivalled pressure”, one Suffolk-based operator has warned.

Chancellor Jeremy Hunt announced an increase to the NLW at the Conservative Party Conference in Manchester on Monday 2 October.

Though owner of the Unruly Pig in Bromswell, Brendan Padfield told The Morning Advertiser​ while hospitality workers “need to be paid more”, there is a “consequence to everything”.

Cost and consequence  

He said: “There is a cost and a consequence to everything. The whole hospitality sector will agree our beleaguered team members need to be paid more.

“But just like doctors, nurses and a whole host of other hard pressed and highly valued workers, the obvious question is how will such further increases be paid for?

“The truth is most employers in hospitality will not be able absorb the cost of meeting this increase as margins have been already slashed - it will have to follow through into increased prices for most in the sector.”

Hunt raised the NLW from £10.42 an hour to at least £11. 

Slings and arrows 

Speaking to GB News earlier this week, the Chancellor said the “priority” for himself, and Prime Minister Rishi Sunak was to bring down inflation and “help families who are finding life really tough”.

Hunt added no tax cuts were “possible in a substantial way” at the moment, stating if there were to be a big tax cut this year it would be “inflationary”, but stressed he did want to bring them down when he could.

Padfield added: “Hospitality is already facing unrivalled pressure. Pubs are closing every day at an alarming rate and customers are already cutting back their discretionary spend because of the cost-of-living-crisis and mortgage increases.

“Further price rises when pub visits and spend are already reducing is not something too many customers will be able to afford. The slings and arrows facing hospitality just seem relentless.”

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