Hospitality Industry: VAT

Debate between Lord Fox and Lord Pitt-Watson

Monday 14th September 2026 Lords Chamber

[Lord Pitt-Watson (Lab)]

The assessment is that this should be in the power of the local authority. It will be devolved. On any cost-benefit analysis that has been done, given that I was alerted to this Question only two hours ago, I do not have that with me. If I could write to the noble Baroness, I would be happy so to do.

[Lord Fox (LD)]

My Lords, I do not believe the Minister had the pleasure of participating in the Employment Rights Bill, and I will not relitigate the entire debate, but the legislation undertakes to substantially change the zero-hours regulations that affect many of the businesses that the noble Lord, Lord Hunt, mentioned. Does the Minister acknowledge that the consultation now and the decisions that will be made as a result of that consultation—how those changes are applied, and in particular the threshold at which they are applied—will materially affect these businesses and existentially affect some of them? Does he undertake to make sure that when those regulations are published, they take into consideration the health of this sector?

[Lord Pitt-Watson (Lab)]

I will try to answer more broadly about employment. The UK employment rate is in the top half of OECD economies. It is above the G7 average. Unemployment is in the bottom half of the OECD. Participation among 16 to 64 year-olds is higher than the average participation rate in every year but one of the last 50 years. The Government are increasing funding for employment support to more than £4 billion a year, including £2.5 billion investment in the youth guarantee and the growth and skills levy in the next three years, supporting 500,000 opportunities to earn and learn in the hospitality industry and all other industries. As I say, we are faced with many challenges ahead of us, but I believe that what the Government are doing in this area is correct.