Help for businesses struggling with energy bills has been announced by new Prime Minister Liz Truss today (8thSeptember). The support will last for six months, with targeted support for vulnerable industries beyond that and that includes hospitality.
She also revealed a new energy price guarantee which will cap average household bills at £2,500 from October.
Marc Crothall, Chief Executive of the Scottish Tourism Alliance said, “The measures announced by the Prime Minister will go some way to alleviating the cost-of-living crisis for many consumers, however it doesn’t go far enough; the proposed price cap of £2500 is still an increase of 54% to households since Spring. Given the continued rise in inflation, consumers will continue to deal with financial insecurity and spending will decline, particularly within the tourism and hospitality sectors.
We are encouraged by the Prime Minister’s commitment to providing “ongoing, focussed support’ for vulnerable industries, which as confirmed in her statement, includes hospitality businesses. This may not however include many other sectors within the tourism industry and the vast supply chain which are also being hit hard by the challenges relating to the cost of living and cost of doing business crisis.
There are many mutually reliant sectors within our tourism industry and all must receive support. We would also hope that support will not exclude businesses of a particular size.”
Kate Nicholls, CEO of UKHospitality said, “We very much welcome the Prime Minister’s recognition of the specific struggles the hospitality industry faces and the promise of further support, alongside her positive plan to help consumers and businesses tackle rising energy bills.
“We look forward to working with the new Government on developing plans that will support long-term recovery for our sector but in order to give businesses big and small a chance to make it to the spring we will need support this autumn and winter. Measures need to provide a swift cash injection, such as cutting VAT for the sector to 10% and providing business rate relief.
“While the welcome energy price freeze will ease the pressure on our customers and colleagues, high bills will still constrain spending in the sector and operators themselves will still have to fund energy bills and other rising costs. For many hospitality businesses this will prove too much to bear and hundreds of community assets will be shut and jobs lost unless additional support is brisk and bold.”
Marc Crothall, added, “There are multiple factors relating to this crisis which must be addressed and a number of fiscal levers which if applied immediately, would significantly ease the burden for businesses in our sector; VAT reduction on supplies relating to hospitality, accommodation and attractions, deferral of the Coronavirus Business Interruption Loan Scheme repayments and the Bounce Back loan repayments, urgent support for businesses struggling to secure new energy contracts and an immediate review of immigration rules to address the labour workforce shortages within the sector.
“I look forward to the announcement of the detail of this initial six-month support scheme for businesses.”
