A new survey by the British Beer and Pub Association, British Institute of Innkeeping, Hospitality Ulster and UKHospitality reveals how almost every hospitality business has seen steep increases in wages and food costs as the inflation rate nudged upwards last month.
The research from the trade bodies indicates that, year-on-year, 95% of hospitality businesses have experienced increased wage costs. It’s a similar story for food (89%), insurance (84%) and energy (57%) costs.
The survey shows that hospitality businesses are in favour of reforming business rates while a VAT reduction for hospitality and a reduction in alcohol duty would be an important measure to allow their business to grow.
In a joint statement, they said, “It’s crystal clear that there is an overwhelming desire from the hospitality sector that the Government rapidly delivers on its manifesto commitment to replace business rates and reduce the burden on high street businesses, as well as continue current support.
“Hospitality continues to remain an outlier sector, with costs continuing to rise sharply compared to the rest of the economy.
“With cost increases affecting almost every venue, this vital sector is being prevented from investing in businesses and communities, which would boost economic growth and new jobs. Instead, they’re having to use dwindling cash reserves just to pay the bills.”
Meanwhile, as the inflation rate rises again, Michael Kill, CEO of the Night Time Industries Association has warned about the impact of tax rises in the Autumn budget saying, “We have observed the slight uptick in inflation from 2% to 2.2% in July, but for our sector, the impact will be minimal. The real focus for night-time economy businesses remains firmly on the upcoming Autumn Budget.
“With a growing government narrative around the voids in public funding that are fuelling inevitable tax increases by the Chancellor on the 30th October. The potential for further tax increases, could place an additional burden on businesses still recovering from the challenges of recent years.
“The Autumn Budget must not lose sight of the fragility of our sector, and prioritise the continuation of support for our sector, ensuring that we are not left behind during this critical period.”