Hospitality Sector: Fiscal Support
Debate between Hannah Bardell and Nigel Huddleston(9 months, 3 weeks ago)
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Nigel Huddleston
Again, these are ongoing conversations across multiple Government Departments. In my former capacity as tourism Minister, I certainly had extensive conversations. There were sub-working groups at UKHospitality identifying areas for further work. That has had some impact, including through apprenticeship schemes. My right hon. Friend was absolutely right to highlight this issue. We have debated Brexit, which probably goes slightly beyond the current remit, although I understand the impact—and, by the way, the opportunities that come from that. My right hon. Friend is right that we need to focus on the domestic skills agenda. The hospitality and leisure sector contributes to one in five new jobs, so it is absolutely pivotal to that.
If hon. Members will forgive me, I will try to get through some of my speech—and not try your patience too much, Ms Bardell—because I am not even on page 1 yet.
Hannah Bardell (in the Chair)
Just to clarify, the Minister has a little bit of flexibility. Given the extent of the debate and the number of questions, he is free to go over the 10 minutes and answer everyone’s questions—as he would like.
Nigel Huddleston
I will make sure I leave a minute or two at the end for the hon. Member for Stirling to conclude—I may have shot myself in the foot there by giving everybody the opportunity to ask all the awkward questions they now have.
Like many hon. Members, my first job was in the hospitality and leisure sector, with a travel agent. I then had the very difficult choice at the age of 22 between taking a job for Arthur Andersen and becoming a Club 18-30 rep. I wonder if my life might have been considerably different if I had taken that slightly different path. My right hon. Friend the Member for Witham is right: jobs in the hospitality and leisure sector help people with numeracy skills, self-confidence and interpersonal skills, which can stay with them for life.
We need to recognise that this sector is not just about part-time jobs for students or young people; we should not forget that there are also valuable, often very high-paying, long-term careers in the sector. The sector has evolved and changed, and is now a major contributor to the UK economy, with £140 billion of economic activity. There are masses of opportunities there, but the reputation and image of the sector is sometimes one of its inhibitors. I am therefore a huge champion of the sector for all the reasons we have outlined.
We have had quite a lot of debate today about the various support measures, including business rate relief. It is worth remembering that the Government provided £16 billion of business rate relief in England through the pandemic. In addition, we launched the temporary 50% retail, hospitality and leisure relief scheme at the 2021 Budget. That was built on in the 2022 autumn statement, and the Government announced further tax cuts to the sector in last year’s autumn statement—about £4.3 billion over the next five years—and extended the retail, hospitality and leisure relief scheme at 75% up to a cash cap of £110,000 per business for 2024-25.
As has been recognised, the Labour Government in Wales and the SNP Government in Scotland were not able to extend those reliefs. I recognise that everybody realises there are considerable financial pressures, but with the greatest respect to my opposite numbers, who have been somewhat critical, I do think this is important and it is something I will play up very heavily: we have done things in England, where we have controlled the levers, that have not been done in Wales and Scotland.
Overall, this tax cut is worth about £2.4 billion for around 230,000 retail, hospitality and leisure properties to continue support for our vital high streets and protect so many small shops and businesses. The Government have also decided to freeze the small business multiplier for the fourth consecutive year. That will protect over a million rate payers and 90% of all properties from a multiplier increase.
For example, as a result of the changes, the average independent pub will receive about £11,800 of relief off their final business rates bill in 2024-25. Combined with the small business multiplier being frozen, they will benefit to the tune of about £12,800 of support. I repeat: that is not the level of support that they would get in Scotland or Wales.
A few points were raised about other areas, and I remind hon. Members that reliefs are also available for improvements in property. If there is an incremental rateable value because of improvements, that will not be included for the first year where eligible. I also remind hon. Members about the changes in alcohol duty and the Brexit pubs guarantee, which are designed to support the pubs sector and to help it operate on a level playing field with supermarkets.
My right hon. Friend the Member for Witham (Priti Patel) made many points about skills and jobs. I will not repeat what I said, because I think I have made the point that we are very aware of the importance of that sector and the role we have in developing skills and opportunities.
Cutting VAT was mentioned by nearly everybody, and I want to be clear on this point. As we all know, VAT is a major contributor to the nation’s finances, which we then spend on our vital public services. It is forecast to raise about £173 billion in 2023-24. Since we left the EU, we have been taking advantage of multiple reliefs. I believe that if we were to rank ourselves against all other EU countries for the total number of reliefs we are able to exercise through VAT, we would be about second or third. We have been taking advantage of leaving by reducing reliefs and making real differences where and when we can.
The VAT cut for tourism and hospitality that we made during the pandemic came at a significant cost of more than £8 billion. Reintroducing it would come at a considerable cost. That was just one element of the support for the retail, hospitality and leisure sector during the pandemic, but it was a really important part of it.
Oral Answers to Questions
Debate between Hannah Bardell and Nigel Huddleston(3 years ago)
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Hannah Bardell (Livingston) (SNP)
The Parliamentary Under-Secretary of State for Digital, Culture, Media and Sport (Nigel Huddleston)
I completely agree with the hon. Lady that sport is for everyone and inclusion is vital. We continue to see some progress in this area—for example, I pay tribute to Josh Cavallo for his leadership in becoming the first top-league male footballer to come out as gay while still playing professionally. I hope that we see others follow his lead.
At the Department for Digital, Culture, Media and Sport, we work closely with Sport England and UK Sport to ensure that people from all backgrounds feel included in sport. As part of that work, the updated code for sports governance will soon require sports governing bodies to agree a diversity and inclusion action plan. That will further support LGBT+ inclusion in sport throughout the country.
Hannah Bardell
I very much share the Minister’s sentiments regarding Josh Cavallo, who has bravely come out, but he is still the only male gay footballer in the professional game in the world. Given the fact that we still do not have any other openly gay male footballers, what message does the Minister think it sends that Qatar—a country that strictly represses homosexual people, with homosexual acts punishable by a decade in prison for non-locals and death for local Muslims—is set to hold the next World cup? Does he agree that nations that treat LGBTQ people in such an abhorrent way should not be gifted international competitions like the World cup?
Nigel Huddleston
The hon. Lady will be aware that we have frank conversations at international level with our counterparts around the world on issues such as human rights and, indeed, gay rights, and we will continue to have those conversations. I would also like to focus on the power of sport to highlight inclusion and diversity and to bring us together. I will focus on the positive things that sport can do over the major sporting events in the coming year, as will, I am sure, the whole House.