The sector has broadly welcomed the Government’s plans for emergency business rates relief for pubs, announced yesterday (Tuesday 27 January).
However, industry leaders warned the measures fall short of the permanent, sector-wide reform needed to address rising costs.
The package includes a 15% cut to new business rates bills from April, followed by a two-year real terms freeze, alongside a review into how pubs are valued for business rates.
While many said this would provide short term respite, others cautioned it would not fix what they described as a broken and outdated system.
Pubcos:
Star Pubs
Star Pubs managing director Lawson Mountstevens said the measures would ease immediate concerns for licensees.
“Although we will need to fully digest the detail, this announcement is a huge boost for pubs and will ease the immediate concerns of publicans up and down the country,” he continued.
“I am pleased the Chancellor has clearly listened to the many Star Pubs licensees who expressed their objections to the plans published at the Budget.
“This support is a welcome acknowledgement of the pub as the cornerstone of British society, and we are committed to working with the Treasury in the coming weeks and months. This support means publicans and their staff are able to focus on the day job – running great pubs at the hearts of their communities.”
Greene King
Greene King CEO Nick Mackenzie said the announcement offered “much-needed relief” for pubs.
He continued: “It also recognises the important role pubs play at the heart of communities across the country. This package gives reassurance to publicans by easing some of the considerable cost increases due to come into effect in April.
“We look forward to continuing to work with the Government on its longer-term plan for fundamental reform of the business rates system, and reducing regulatory burden, which is desperately needed by pubs and the wider hospitality sector.”
Admiral Taverns
Chris Jowsey, CEO of Admiral Taverns, commented: “The Government’s announcement shows clear recognition of the value which community pubs bring to the UK and we’re delighted that it has listened to our concerns.
Our small community pubs will still experience an overall increase, however the impact will be much less, and this will give them clarity for the next three years. We are a vibrant industry at the heart of local communities up and down the country, and this will help our pubs continue to be vital social and cultural hubs for their neighbourhoods.
We are encouraged by this first step, and it is now critical for the Government to work with the industry to find a permanent and meaningful solution."
Ardent Pub Group
In contrast, Dom Jacobs, founder and managing director of Ardent Pub Group, said the announcement failed to address the scale of the challenge facing hospitality.
“Rachel Reeves’ latest U-turn may be welcome, but it is wholly inadequate,” he said. “Hospitality continues to shoulder an excessive tax burden, and this half-measure does nothing to change that.
“Instead of backing a sector capable of delivering real growth and jobs, the Government has once again missed the mark, a failure that will inevitably push many brilliant publicans out of business. That would be nothing short of a tragedy.”
Punch Pubs & Co
Meanwhile Punch Pubs & Co chief executive Andy Spencer was more positive about the intervention but stressed further reform is needed.
He said: “We welcome the Government’s decision to address the proposed rise in business rates for pubs with a specific support package.
“Our pubs are at the heart of communities up and down the country, delivering significant socio-economic value; yet for too long they have shouldered a disproportionate and deeply unfair tax burden that has threatened their long-term sustainability.
“This announcement is a necessary correction, not a solution, and we will continue to work with the Government, alongside our trade associations, in order to achieve meaningful, long-term reform of the rates valuation system.”
St Austell Brewery
St Austell Brewery chief executive Kevin Georgel said he was pleased the Government had engaged with and listened to sector trade bodies as well as the public on the importance of pubs.
“It has been heartening to see the support of the public play out so clearly across the media in recent weeks and this public support has rightly influenced the Government to reconsider their proposed changes to business rates that would have seen an acceleration in pub closures”, he continued.
“We now need to continue working with the Government to permanently overhaul the outdated business rates system.
“Over time, we must create the conditions in which pubs can not only survive, but once again thrive at the heart of their communities - providing valuable employment, fostering social connection and cohesion, and acting as engines of economic growth across the length and breadth of the country.”
Young’s
Young’s boss Simon Dodd had a more critical response, describing the announcement as short term relief that failed to address deeper structural issues.
“These measures may provide some temporary relief to pubs but it is ultimately just an example of sticking a plaster over a much bigger wound, which is disappointing,” he added.
“It is nowhere near enough to fix the fundamental problem of a broken business rates system that disproportionately penalises bricks-and-mortar premises. For years we have been calling for real business rates reform – or ideally, the scrapping of this unfair tax altogether.
“Hospitality can be a powerful driving force for growth in the UK, but only if the government delivers a genuine growth agenda by reducing VAT, freezing beer duty and properly addressing business rates.”
Trade bodies:
UKHospitality (UKH)
UKH welcomed the intervention but stressed rising costs remain a hospitality wide issue.
Chair Kate Nicholls said: “The rising cost of doing business and business rates increases is a hospitality-wide problem that needs a hospitality-wide solution. The Government’s immediate review of hospitality valuations going forward is clear recognition of this.
“This emergency announcement to provide additional funding is helpful to address an acute challenge facing pubs. The reality remains we still have restaurants and hotels facing severe challenges from successive Budgets.”
British Beer & Pub Association (BBPA)
The BBPA told The Morning Advertiser (The MA) the package would “stave off” the immediate financial threat posed by accelerating business costs for many pubs.
CEO Emma McClarkin said: “We are pleased the Government has listened to our concerns, and those of publicans, consumers and MPs who rallied to defend our locals.
“This additional support will provide certainty for tens of thousands of pubs, with many seeing their bills frozen or falling and there will be a sigh of relief from landlords across the country.
“We will now work closely with Government to establish a transformative long-term plan that works for all pubs through permanent business rates reform to ensure they remain at the heart of communities.”
McClarkin added the support showed a “real commitment” from Government to cut regulatory burdens for the sector and help drive growth.
CAMRA
The Campaign for Real Ale (CAMRA) chair Ash Corbett-Collins further warned the relief does not provide the certainty publicans need.
“This short-term announcement is not the ‘permanently lower business rates’ that pubs were promised,” he said.
“While it is positive that the Chancellor has listened and announced extra discounts for pubs facing the threat of closure, it is short-sighted to think that today’s statement will give publicans the certainty they need.
“The plan to review the unfair way pubs are assessed for business rates is welcome, but this leaves them in the same situation as they have been for years – still facing a long wait for promised, and fundamental, reforms to make the system fairer.”
Night Time Industries Association
Meanwhile, the Night Time Industries Association (NTIA) described the relief as insufficient in the context of wider cost pressures.
Chief executive Michael Kill said: “While any recognition of the pressures facing pubs and music venues is welcome, this intervention amounts to little more than a drop in the ocean when set against the reality of the current tax system and the cumulative damage inflicted by the last two budgets.
“This limited, narrowly targeted relief raises a serious question: what will this actually do for the hospitality and night time economy as a whole?”
Kill warned that “piecemeal, sub-sector-specific interventions will not stabilise the industry”.
He added without a sector-wide approach “closures will continue, jobs will be lost, and vital cultural and social infrastructure will be permanently damaged”.
British Institute of Innkeeping
Elsewhere, British Institute of Innkeeping (BII) chief executive Steve Alton stressed the package must mark the beginning of “true reform” for the sector.
“The majority of our members, independently operating pubs in every community, will now see the business rates they pay today frozen or reduced from April, and held at that level over the next three years,” he said.
“This cannot be the end of the story, however. Today’s announcement will buy many in our sector time, but their situation is still untenable in the long term, with over 40p in the £1 still going to the Treasury."
Society of Independent Brewers (SIBA)
SIBA chief executive Andy Slee welcomed recognition from the Government of the need to reform the business rates system.
He continued: “On the basis the further 15% cut announced today applies to the business rates bills that were due in April this is good news for pubs and brewers and will allay some of their worst fears.”
He added the organisation looked forward to working with the Government on a long term solution.
Further reaction
While the package was mostly welcomed by pubs, Access Hospitality managing director Champa Magesh criticised its limitations for the wider hospitality sector.
She said: “It is pleasing to see the Government acknowledge the vital role hospitality plays in the UK’s economic and social fabric.
“The package is a small step in the right direction and recognises the support needed for pubs, but this needs to be delivered swiftly to protect businesses’ long-term growth.
“It is disappointing this latest package focuses primarily on pubs, without extending the same level of relief to restaurants, hotels and the wider hospitality sector. Hospitality is an interconnected ecosystem, and long-term resilience depends on ensuring all venues are supported consistently.”
Similarly, RSM UK head of leisure and hospitality Saxon Moseley described the announcement as a “welcome first step” but warned excluding restaurants and hotels risked creating new inconsistencies across the sector.
