Hospitality Sector

Mike Wood Excerpts

Wednesday 3rd September 2025 Commons Chamber

[Chris Bryant]

We are not taxing them out of existence, as I have tried to explain to the hon. Gentleman. He is another one of those people who is awfully nice when you meet him in the bar—[Interruption.] The shadow Secretary of State is saying that that sounds terrible, but he was saying earlier that every single pint that is pulled represents an increase to the economy, so the hon. Member for Meriden and Solihull East (Saqib Bhatti) helped out. The point that I am trying to make—not very well—is that it is impossible to simply say, “We are not going to tax,” and still want to see the same level of expenditure. That is what got us into the trouble in the Truss Budget, and for family finances that meant—

[Mike Wood (Kingswinford and South Staffordshire) (Con)]

On that point, will the Minister give way?

[Chris Bryant]

I will not give way again. That meant that mortgage rates rose faster than they have ever risen in our history, which made it almost impossible for people to survive economically.

--- Later in debate ---

[Mike Wood (Kingswinford and South Staffordshire) (Con)]

I draw the House’s attention to my entry in the Register of Members’ Financial Interests. I have received hospitality below the threshold from UKHospitality, the British Beer and Pub Association, the Campaign for Real Ale and probably the British Institute of Innkeeping.

Hospitality, as has been said, offers more than just a place for food and drink. With Pub is The Hub, I was fortunate to see pubs in Cornwall that offer everything from the last village shop to jobs, clubs and even the village hairdresser and barbers. I think of the venues that provide drop-in sessions to tackle loneliness and isolation in our communities, and I think of all the pubs, cafés and restaurants up and down the country that fund grassroots sports and raise enormous amounts of money for charities and local good causes. That is why the previous Government worked so hard to try to support them. They scrapped Labour’s beer duty escalator. There was a series of freezes and cuts in alcohol duty, and a new draught beer duty differential, so that a pint in a pub always pays less duty than equivalent beer bought in supermarkets. We had 75% business rate relief for hospitality businesses, taking three quarters off their bills. We must not forget the tens of billions of pounds invested in supporting hospitality during the pandemic and as we recovered from the effects of covid.

Even though that support made the difference between surviving and going under for many, it was still tight. Many still carry a lot of covid debt and they still need our support. Instead, they have suffered a continuous onslaught of taxes and higher costs caused by Labour’s choices since the election. The changes to national insurance contributions, the national minimum wage and business rates have piled an additional £3.4 billion a year on to businesses, and the Government have hit hospitality businesses that rely on many part-time staff particularly hard.

It is no wonder that eight in 10 operators have been forced to raise their prices since April. Business rates more than doubling for a small independent pub or café have meant that thousands of pounds is out of the till before a single pint has been pulled or a single breakfast served. Those are fixed costs that many just cannot meet. Some 69% of businesses are running below required capacity because of staff and cost pressures. One in eight are planning to cut sites and two thirds have cut staff hours. As has been said, the chair of UKHospitality put it plainly last month when she said:

“At a time when the country needs jobs, the Government should be encouraging hospitality to grow and create jobs, not tax them out of existence.”

As we prepare for the pre-Christmas Budget, we need the Government to take this issue seriously and to take hospitality needs seriously. They need to fix national insurance contributions by raising the threshold, particularly for smaller venues. They should introduce exemptions for young people and returners to work. We need them to reconsider their plans to pile further burdens on small businesses next year. We need them to come good on their promise to reform business rates and make sure that when that reform finally happens, those businesses are paying bills that are lower, not higher than what they were paying last year. Finally, the Government should look at how some flexibility can be added to covid loan repayments so that those loans do not threaten otherwise viable businesses.