The UK's hospitality sector, reeling from years of decline and uncertainty, is holding its breath as Prime Minister Andy Burnham explores an extensive package of long-term support measures. A 20% cut to business rates for pubs, social clubs, and live music venues, announced this week, has been welcomed by the industry but seen as merely a starting point by those on the frontlines. Shrewsbury Labour MP Julia Buckley, who has spent time working alongside staff at The Crown in Abbey Foregate and participated in a roundtable event with CAMRA, believes the sector is "on its knees" and urgently needs additional support.
The business rates reduction, which will come into effect from April 2027, is estimated to save eligible businesses around £1,100 next year. However, Ms Buckley's firsthand experiences have informed her discussions with ministers, who are now reviewing a 'longer term package' over the summer. This review aims to identify additional avenues of support, with potential changes to Value Added Tax (VAT) being closely watched by industry figures.
While the business rates cut has been hailed as a positive step, those within the sector stress that it is not enough. Caleb Matthews, business manager at The Crown, acknowledged the reduction but highlighted that "hospitality needs as much support as possible." He also underscored the critical importance of addressing VAT, with hopes for changes to be announced in the autumn Budget.
The current business rates discount marks the second round of relief for pubs, following a 15% cut introduced in April. However, this latest reduction will not apply to the very largest live music venues, and full eligibility criteria are expected to be detailed in Chancellor John Healey's first Budget later this year. The exclusion of hotels and restaurants from this specific business rates cut has led to questions regarding the scope of government support.
Ms Buckley's comments suggest a more comprehensive strategy is being developed by the Prime Minister, who is "looking at the wider package" and VAT. She anticipates that a long-term plan could be unveiled when Parliament reconvenes in September, potentially including a 10-year roadmap for both the hospitality and retail sectors.
Government estimates suggest that around £1,156 will be saved annually by The Crown under the new business rates reduction. This saving is welcomed but seen as insufficient to address the sector's ongoing challenges. With an eye on the autumn Budget, industry figures are hopeful that additional support measures, including changes to VAT, will be announced to alleviate the pressures faced by hospitality businesses.