Pub and Hospitality Sector

Gareth Thomas Excerpts

Tuesday 22nd October 2024 Westminster Hall

[The Parliamentary Under-Secretary of State for Business and Trade (Gareth Thomas)]

In the usual way, let me take the opportunity to congratulate the hon. Member for Mid Leicestershire (Mr Bedford) on securing this debate and celebrating the contribution of pubs to life in his constituency. He rightly talked about the contribution that pubs make to social mobility and the journey all the way up to manager that those who start out as pot washers can potentially make. I noted in particular his praise for the Curzon Arms and I can assure him we will consider that as the campaign stop for when we visit his constituency at the next election to try to increase our majority in this House. He, and I hope the whole House, will understand if I briefly praise pubs in my own constituency—the great Horseshoe, where I have been privileged to watch one or two great victories by the Welsh rugby union team, and the Trinity pub where we have celebrated one or two election successes in recent times.

I will not be able to do justice in the time available to me to the richness of the contributions that we have had, for which I apologise to hon. Members across the House. Notwithstanding, let me try to make one or two points and to pick up some of the specific questions that people have outlined. My hon. Friend the Member for Liverpool Riverside (Kim Johnson) celebrated her constituency’s many pubs and venues, some of which I have had the privilege to visit during what seems like Labour’s annual trip to her great city. Perhaps she might like to buy me a round when I next have to visit one of those pubs—[Hon. Members: “Freebies!”] [Laughter.] Perhaps not, then.

My hon. Friend the Member for Stoke-on-Trent South (Dr Gardner) referenced the Labour in Vain pub in her constituency. I am happy to sit down with her and talk about what else might be possible for that pub. She is right to celebrate community-owned pubs; I suspect that she, like me, comes from the Co-operative tradition in our ranks. The Co-operative party has championed the ambitions of many of our communities to own their own pub.

My hon. Friend the Member for Stockport (Navendu Mishra), in his inimitable way, championed the contribution of pubs to the life of his constituents. I hope I will have the opportunity at some point to come up and take advantage of the hospitality there. My hon. Friend the Member for Bournemouth East (Tom Hayes) rightly praised the contribution of business improvement districts to supporting the environment around pubs. The business improvement district in my constituency does a particularly important job working with the police to tackle antisocial behaviour, and I know that work is replicated in business improvement districts across the country. He made an ambitious claim that the best kebab in the country is found in his constituency—I wonder whether others might have a slightly different perspective.

My hon. Friend the Member for Southend East and Rochford (Mr Alaba), who is unfortunately not in his place, rightly championed the soft skills learned by those who work in the pub trade. My hon. Friend the Member for Carlisle (Ms Minns) made an interesting speech—I was not sure quite where it was going to end with the reference to nationalisation, but I look forward to having the opportunity to find out a bit more about the unique history of the pubs in her constituency.

My hon. Friend the Member for Edinburgh East and Musselburgh (Chris Murray) underlined the role of pubs in his constituency and the crucial contribution that Scotch whisky makes not only to the Scottish economy, but to the UK economy as a whole. He will know of the work my right hon. Friend the Minister for Trade Policy and Economic Security is seeking to do to reduce some of the tariffs that Scotch whisky still faces around the world. If I heard him right, I think my hon. Friend the Member for Hexham (Joe Morris) promised to visit all 116 pubs in his constituency before the next election.

The hon. Member for Gosport (Dame Caroline Dinenage) referenced previous work she had done with the Culture, Media and Sport Committee and I will reflect on her contribution and the Committee’s work outside this House, if I may. I hope to touch on the contributions of one or two other hon. Members as I make my way through some of the broader points, where appropriate.

This debate is important because our pubs and the wider hospitality sector are crucial to the UK economy, employing around 2.2 million people across 154,000 businesses and generating revenues of around £52 billion per annum.

[Steff Aquarone (North Norfolk) (LD)]

I am grateful to the Minister for giving way. He is making some important points about the employment generated by the sector. Does he agree that in areas such as North Norfolk, with a huge hospitality industry, greater training opportunities are vital to allow people to have full and flourishing careers in the hospitality sector? Are the Government supportive of extending that franchise?

[Gareth Thomas]

I congratulate the hon. Member on getting his constituency’s pubs into the debate. I look forward to having the opportunity to visit one or two of those in his constituency again. I will come back to the significant point about training, on which I hope we will have some good news for the pubs in his constituency and more generally.

Pubs and hospitality venues are important to local economies. They help to create vibrant towns and cities that we all want to visit, to study, work, live and invest. Pubs help us to celebrate the very essence of life and friendship, to socialise with family and friends, to enjoy music and great sport, and to celebrate the important points in life’s journey. They are crucial to supporting wider social objectives: providing accessible jobs, as other Members have already touched on, helping to support community cohesion and providing welcoming spaces for those who feel isolated and alone to enjoy the company of others.

In short, hospitality is the backbone of our high streets and the lifeblood of so many of our communities. We all know that hospitality businesses are still struggling. At the weekend, the Yorkshire Post published a survey suggesting some 500 pubs had closed in Yorkshire since 2019, which is just one indication of the challenges facing the pub and hospitality industry.

[Jamie Stone]

I value the Minister’s words. Does he accept my earlier point that those businesses could do with getting the eastern European and foreign workers they used to have?

[Gareth Thomas]

I heard the point the hon. Gentleman made, and I want to come to the issue of access to talent to work in pubs and hospitality venues. While we always need to consider issues around visas and the right to work, we can do more to help people in our country to get access to jobs in the pubs and hospitality industry. The point I intend to make in relation to the intervention by the hon. Member for North Norfolk (Steff Aquarone) is pertinent to that.

As I said, we all know that hospitality businesses are struggling to recover from the pandemic, where closures and customer restrictions decimated cash reserves and drove up levels of debt. I say this gently with so many Conservative Members present, but the subsequent cost of living crisis, which was driven in part by the incompetence of previous Governments, has compounded the challenge for hospitality businesses and increased costs, and it has caused real difficulties and challenges for businesses in repaying some of those debts. One thinks in particular of the contribution Liz Truss made to those issues.

[Robbie Moore]

I am sure the Minister will get to it, but I am really keen to understand some of the specifics of what he is doing in his role as the Parliamentary Under-Secretary of State for Business and Trade. What is the nature of his conversations with the Chancellor and the Treasury, specifically around business rates relief, VAT threshold, VAT duty, beer duty and the concerns raised by the likes of UKHospitality with the Employment Rights Bill? I am sure he is getting there, but this side of the House is keen to understand what he is doing in his role in the conversations with the Chancellor on the forthcoming Budget.

[Gareth Thomas]

I am very grateful to the hon. Gentleman for giving me the prompt to get on to the issues around the Budget next week. He will understand, as one or two of his colleagues alluded to earlier, that I will not speculate on what will or will not be included in the Chancellor’s Budget. However, I can say that we recognise the very important role that hospitality businesses play in supporting local economies and communities, and we understand the pressures facing those businesses. When we were in Opposition, one of the biggest complaints we heard from high street businesses was the unfairness of the antiquated system of business rates. I apologise to him—I appreciate it is difficult to hear—but I think one of the reasons his party lost the confidence of the business community was because it had made multiple promises to abolish or reform the business rates system, but never actually got to that issue.

Business rates are particularly unfair for hospitality, leisure and tourism businesses which, as others have alluded to, create 5% of the UK’s GDP but pay 15% of all business rates. Not only is the current system of business rates unfair, but we know that it disincentivises investment, creates uncertainty and places an undue burden on our highstreets, and in the context of this debate, on pubs and hospitality and venues. That is why we included in our manifesto a commitment to reform business rates, and it is why the Chancellor has continued to commit to setting out next steps on that at the next Budget.

[Esther McVey]

I would like to take away some comfort and be able to speak with my pub owners and pub landlords. Will the Minister commit today to speaking to the Chancellor about business rates before the Budget next week? I want him just to confirm that he will be making the representations from today’s debate to the Chancellor before the Budget.

[Gareth Thomas]

I am happy to confirm to the right hon. Lady and the whole House that I will ensure that the Treasury and the Chancellor are aware of the comments made in this debate. She will understand that crucial to the future of pubs and the hospitality industry is getting growth going in our country—in particular, getting more disposable income into the pockets of potential customers of pubs and other hospitality venues.

That is one reason the Prime Minister has made growth the number one mission of the Government. It is why we have already taken a series of steps to underline the significance of growth, from publishing a Green Paper on industrial strategy through to the success of the investment summit last week. It is also why we have introduced the package of measures to make work pay, including the Employment Rights Bill, which the House debated yesterday.

I want to pick up one or two specific points hon. Members made, in particular the reference by the hon. Member for North Norfolk to training. He may know that there has been much frustration across the business community, including from pubs and hospitality businesses, about how the apprenticeship levy works. We have committed to reforming that levy and to giving more focus to the skills needs of businesses.

That is one reason we have already established Skills England, which will have a new partnership with employers at its heart and will transform the existing apprenticeship levy into a more flexible growth and skills levy, to support business and boost opportunities for those living and working in the UK—something the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) will be pleased to hear.

Interventions from the hon. Gentleman, my hon. Friends the Members for Cumbernauld and Kirkintilloch (Katrina Murray) and for Edinburgh East and Musselburgh and the hon. Member for North East Fife (Wendy Chamberlain) provide me with an opportunity to suggest gently that the Scottish Government might want to think again about their decision not to pass on the business rate relief to pubs that the Treasury in London sends them—

[Valerie Vaz (in the Chair)]

Order. Could the Minister start winding up his remarks?

[Gareth Thomas]

Lastly, Ms Vaz, Ofgem has announced a series of measures to protect non-domestic energy customers from poor behaviour by energy suppliers, which I hope will address some of the concerns that we heard on that issue.

[Mike Wood]

On a point of order, Ms Vaz. I should have drawn attention to my entry in the Register of Members’ Financial Interests before I spoke. I hope you will help me to get that on the record.