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TeaFiona Hornsby has only one thing on her mind as she prepares her pub for the busy Christmas period – and it’s not the crowds of happy revelers celebrating the festive season over the coming months.
Instead, she, like many campaigners across the country, is nervous just days before Rachel Reeves’s budget on Wednesday.
chancellor Will outline her financial plans next week And Britain’s pubs are bracing themselves for a tough few years after enduring Covid lockdowns, a cost of living crisis and squeezed margins.
Number of pubs in England and Wales to reach lowest level in 2022 and continues to fallMore than 400 have called for final orders in 2024 and two venues are now closing every day, according to trade body UKHospitality,
The hospitality industry has partly blamed successive governments for the problem and attacked Ms Reeves’s decision to hit employers with an increase in employer national insurance contributions and a cut in business rates relief from 75 per cent to 40 per cent.
According to Ms Hornsby, owner of three venues, similar measures to last budget year, or a rumored increase in liquor duty, would be disastrous. Liverpool city center – The Denbigh Castle, The Bridewell and The Pen Factory.
he told Independent: “We’re absolutely scared of what’s going to happen next week. We’re just scared. It’s ‘Will it cost more?’ No, it’s ‘How much is it?’ Is.
“You’re supposed to go through all your accounts again, look at all your product prices again and see where you can save anything.
“Even if you can shave money off, it all adds up. You don’t want to impose those prices on the customer, we all sympathize because our own pockets are being squeezed.
“If you only have £10 to go out, you want at least two drinks. If you can’t get two drinks per person, that’s just plain wrong.”
In April this year – the same month when the last budget measures were introduced – the average price of a pint in Britain exceeded £5 for the first time.
This was the point at which Country Pub They fell off a cliff on which they had been crouching for some time, according to James Nee, managing director of Anglian Country Inns, which runs 10 pubs in Hertfordshire and Norfolk.
He said the increase in National Insurance had exacerbated existing challenges including inflation and the level of VAT facing the sector.
he told Independent The industry has been taken “out of the pan flying into the fire on numerous occasions”, leaving pubs with no ability to employ people and no way out except to raise the price of a pint.
Mr Nee added: “You’re going to have to pass the cost on to you. We haven’t passed it all on to you, but you’re going to have to pass some of it on to you and things will become much more expensive.”
“When customers see us raising prices, they think we’re profiting from it, but in reality the government is taking so much tax out of that pint, that it’s not reaching the bottom line.
“The bottom line is going down, even though the top line is going up – I think that’s the scary thing. The biggest part of all of this is taxes.
“We are proud tax collectors as an industry. I think for every profit I made last year I paid about £7 or £8 to the government.”
A similar situation is facing James Wilson, general manager of The Pheasant, a pub in the Cornwall village of St Newlyn East. He said The Pheasant had its busiest October on record, but that was only £800 profit to show for it,
He said: “We’re not in a situation where we want to make hundreds of thousands or millions. It’s a lifestyle role that I took on because I wanted to do it.
“But the difficult part is to make sure it’s viable without putting me or my family in a situation where we’re not making any money to survive.”
He wants the budget to include cuts in VAT and beer duty. Instead, Mr Wilson is predicting that taxes will increase. Ms Hornsby issued a warning about what would happen if that happened.
She said: “It’s a perfect storm – it never ends. Nothing ever ends. Everything you read about pubs tells you there’s one closing a day.
“I’ve also read that 30 per cent of pubs are floundering and are just about to open the doors. If costs rise any further, the doors will close.”
For Mr. Nee, the social impact of those doors closing cannot be underestimated. He believes this represents an irreversible change to the fabric of Britain.
He said: “The Great British pub is one of our national treasures. It’s something we’re proud of, it’s one of our institutions.
“But I would say it’s more difficult now than going through Covid. At least in Covid we had support and we had awareness.”
He further said, “The government needs to wake up because we are the solution to some of their problems.” “We can collect taxes, we can employ people, we can be great contributors to the economy but we should be given the opportunity to do so. It’s like they’re strangling the golden goose.”
As such, next Wednesday is “make or break” time for pubs, said UKHospitality chair Kate Nicholls, who believes the industry has “bought the brunt” of the last Budget.
He said: “Since last year’s Budget the whole of the UK has seen 13 consecutive months of employment decline and 170,000 fewer people on the payroll – a shocking indictment of the damage those measures are causing.
Ms Nicholls believes the industry is being “taxed” and has called for urgent action – reducing business rates, cutting VAT and addressing National Insurance contributions – to save the country’s water crisis.
He added: “Anything less risks more closures, higher prices for consumers and the loss of the vibrant hospitality that defines our communities and our capital. Hospitality is poised to drive growth and recovery, but we need the support and support to do so.”
A government spokesperson said: “Pubs are vital to local communities, which is why we’re cutting licensing costs, reducing their business rates and helping more hospitality businesses offer sidewalk drinks and al fresco dining, as well as cutting alcohol duty on draft pints and capping corporation tax.”