UKHospitality warns business rates reform ‘critical’ for sector as it faces additional £1.4bn in wage increases: UKHospitality has said the additional £1.4bn in wage increases from April means business rates reform in full for the sector is “critical”. The government has announced that, from April 2026, the national living wage will jump to £12.71, an increase of 4.1%. The wage rate for 18 to 20-year-olds will increase to £10.85, a higher-than-expected increase of 8.5%. In total, the wage increases represent a total of £1.4bn in additional cost for hospitality businesses. UKHospitality said the additional cost “once again increases the sector’s tax burden and further demonstrates the need for the government to deliver business rates reform in full”. The trade body has called on Downing Street to implement the maximum possible business rates discount for all hospitality properties below £500,000 rateable value. The trade body also wants to ensure no penalty charge is applied to any hospitality property above £500,000 rateable value. UKHospitality also warned that the level of increases to youth rates will put further pressure on youth employment – just days after the Office for National Statistics revealed there were almost a million young people not in employment, education or training. Kate Nicholls, chair of UKHospitality, said: “Increases to minimum wage rates are yet another cost for hospitality businesses to balance, at a time when they are already being taxed out. These additional costs make action at the Budget to reduce hospitality’s tax burden even more important, especially if businesses are expected to sustain this level of annual wage increase. Hospitality businesses have reached their limit of absorbing seemingly endless additional costs. They will simply all be passed through to the consumer, ultimately fuelling inflation. The sector needs the chancellor to reduce its tax burden through significant business rates reform tomorrow (Wednesday, 26 November). We need to see the maximum possible business rates discount for all eligible hospitality properties and no hospitality venue hit by the surcharge. The higher-than-expected increase to the rates for under-21s is also worrying for hospitality businesses, who had hoped the government would take a more pragmatic approach to achieving its goal of equalising all wage rates. When there are almost a million young people not in employment, education or training, this will put further pressure on already fragile youth employment rates. Given the government’s ambition to help young people back into work, this level of increase is concerning. Hospitality is a sector that offers opportunities for all, regardless of experience or background, and is uniquely placed to help tackle youth unemployment. This should be embraced and supported, rather than discouraged.”

Luke Johnson – ‘the employment rights bill is going to be deadly and needs to be binned’: Sector investor Luke Johnson has warned the employment rights bill is going to be “deadly” and “needs to be binned”. The Department for Business and Trade has said from April 2026, there will be changes to statutory sick pay, paternity and parental leave, and trade union recognition. From October 2026, tipping laws will be tightened and employers’ duty to prevent sexual harassment strengthened. And 2027 will see rights to guaranteed hours introduced, alongside existing rights to request flexible working being strengthened, and changes made to an employees’ right to claim unfair dismissal. Speaking at the Propel Multi-Club Conference, Johnson said: “We have incompetents in charge in government who don't begin to understand economics or this sector. Managing the workforce will be made ever harder and more costly and less efficient. The number of walking wounded has grown. Too many operators are surviving rather than making any return. On top of the painful increase in tax and the lack of cutting of public expenditure that we're going to get in the Budget, we have the employment rights bill, which I read a report that suggests it could £76bn pounds. Our sector will be disproportionately hit. And I think that it won't be one of those instant changes like the national insurance cost, but it will be a slow burn of pain of increased claims and of managing a workforce made ever harder and more costly and less efficient. The quick fix [the government can do] is the bin for the employment rights bill – it's going to be deadly.” Johnson, who heads private equity investor Risk Capital, has invested in a wide range of sector businesses including PizzaExpress, Gail’s Bakery, Brighton Pier Group and The Revel Collective. Johnson was among the speakers at the Propel Multi-Club Conference. All videos from the conference were released to Premium subscribers on Friday (21 November). Premium subscribers receive all the videos from Propel conferences each year – around 100 in total. A Premium Club subscription costs an annual sum of £495 plus VAT for operators and £595 plus VAT for suppliers. Companies can now have an unlimited number of people receive access to Premium Club for a year for £995 plus VAT – whether they are an operator or supplier. Email kai.kirkman@propelinfo.com today to sign up.