UK pubs cut hours after budget tax and rates rises
Almost half of Britain’s pubs have reduced opening hours following higher taxes and costs introduced in recent budgets. Industry leaders warn the measures are hurting jobs, communities and high streets despite strong trading.
A survey by the British Beer and Pub Association (BBPA) shows that almost half of Britain’s pubs have cut their opening hours over the past year in reaction to Chancellor Rachel Reeves’ Budget measures.
The findings, revealed by the Daily Telegraph, show that 47% of pub owners reduced their opening hours on trading days between April and October last year.
Given that many pubs are in multiple ownership, it is probable that more than half the UK’s estate have reacted to Reeves’ measures by cutting the service they provide to the public and local communities.
Rising costs and policy changes
Since coming to power 18 months ago, Reeves has used two Budgets to increase employer National Insurance rates, enhance the minimum wage and cut the business rates relief introduced to help the hospitality industry survive during the coronavirus pandemic shutdowns.
At the same time, utility costs have soared and excise duties have been increased at the rate of inflation.
Staffing and closures
One in seven pub owners told the BBPA they were closed entirely on some days of the week, while almost two-thirds said they had cut staff hours.
Given that the survey covered seven months to last October, it is highly probable that the number of publicans taking similar action has widened.
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Business rates impact
Reforms to business rates announced by Reeves in November mean pubs are facing combined extra annual costs of £150m over the next three years due to property revaluations and because she did not extend the Covid relief measure.
Industry reaction
Emma McClarkin, chief executive of the BBPA, told the Telegraph: “Publicans across the country are being forced to cut staff hours and shut up shop earlier simply because of the cost of keeping the doors open, which hurts workers, communities and high streets.
“It doesn’t make sense that even though pubs are busy and trading well, huge rates and taxes are draining their profits,” she said.
Possible policy U-turn
It has been widely reported that Reeves has been under intense pressure from backbench Labour MPs and is poised to make a U-turn and introduce a relief package to help publicans survive.
One of the mooted measures is that, on cost grounds, any relief would apply only to pubs but not to restaurants and other hospitality outlets. That has already raised eyebrows in the hospitality sector.
How, one observer asked, can a legal differentiation be made between a pub selling food, a restaurant selling alcohol and a hotel? They all require a Premises Licence to sell alcohol.
However, McClarkin said, “The BBPA has worked closely with ministers on a pub-specific solution that would ensure that bills are reduced in line with the government’s previous promises to pubs, and we keenly await seeing the details of the upcoming announcement.”
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