Propel Newsletter Archive Page

Labour backbenchers press Rachel Reeves to help save British pubs: Dozens of Labour MPs are pushing the Treasury to provide more support for pubs, warning they will go bust due to an increase in business rates. Sources said that Rachel Reeves, the chancellor, is facing a big blowback over the move. She has been accused of breaking a pledge to cut costs for struggling high street businesses. The issue could come to a head next Monday, when MPs will vote on a finance bill to approve changes to income tax thresholds and the climbdown on farmers’ inheritance tax. The Times understands that two dozen Labour backbenchers are leading a campaign to get Reeves to provide more financial support to small and medium sized enterprises (SMEs). One of the leaders of the campaign pressing for more support said: “Some businesses are just trying to stay afloat, but the business rate changes will mean job losses. Where do young people get their jobs? They get them in retail, hospitality and pubs. Protecting those businesses is vital if we want to boost their prospects and grow the economy.” Another said: “The problem is, MPs were all briefed to go out hard saying business rates were falling for SMEs and rising for the largest firms. This was categorically untrue given the post-covid adjustments issue. The blowback from MPs is big – it has badly damaged trust in the central briefings and people are very annoyed.” Jonathan Reynolds, the chief whip, is said to have a “continued interest” in the issue of business rates from his previous post as business secretary. Industry sources said Peter Kyle, his successor, had since Christmas realised the “damaging” extent of the business rates rise and was making representations to the Treasury. Reeves is being urged to freeze the rate increases in April, instead of raising them in the following two years. The chancellor is also being lobbied to provide sector-specific support by increasing the discount for 75,000 pubs, bars, restaurants and hotels in England from 5p to 20p, paid for by raising the amount owed by bigger businesses. Dan Tomlinson, the exchequer secretary, met members of the British Beer and Pub Association on Tuesday. Afterwards, the group said the government was “in listening mode” and “open to what else can be done”.

UK pubs call on Starmer to provide urgent financial support: Pub bosses have criticised Sir Keir Starmer’s suggestion that higher business rates bills can be softened by licensing reforms, as they called on the prime minister to provide urgent financial support. The FT reports that industry leaders met Treasury minister Dan Tomlinson to discuss the burden of business rates on the hospitality sector, with a budget increase in the tax paid on commercial properties adding to pressure on pubs. The prime minister on Monday said pubs would “struggle” as a result of the higher rateable values, telling LBC that “because of revaluation, that means that some will have their bills going up”. The government was putting transitional relief in place – though pubs say bills will still be significantly higher in three years’ time – and looking at “licensing freedoms”, he added. Downing Street said on Tuesday that it was exploring “speeding up licensing reforms, slashing red tape, helping more venues stay open later, offering pavement drinks and putting on one-off events”. But Jonathan Neame, chief executive of Shepherd Neame, dismissed licensing reforms as “a shallow political smokescreen, which will make little or no difference to the hospitality sector”. Alex Reilley, executive chair of Loungers, said he did not “know of a single hospitality business that is calling for more relaxed licensing laws to allow for extended opening hours. On the contrary, in an attempt to make their business viable, [a] large number of hospitality businesses are reducing their hours.” Pubs could not afford the extra costs of operating for longer, Reilley added, noting that customers were “eating and drinking earlier than they were pre-covid”. Andy Spencer, chief executive of Punch Pubs, said that while it was “encouraging to hear the government acknowledge the pressure pubs are under, warm words alone won’t be enough”. After the meeting with Tomlinson, Emma McClarkin, chief executive of the BBPA, said the government “understands the strength of feeling amongst the sector” and was “in listening mode”. “We will be meeting again in the coming weeks,” she added.

Shepherd Neame CEO – ‘There’s a risk Labour is doing to us what Thatcher did to the miners’: Jonathan Neame, chief executive of Kent brewer and retailer Shepherd Neame, believes the pub sector is now at one of the most critical points in its history. “I think there is a real risk that Rachel Reeves is doing to our sector what Margaret Thatcher did to the miners,” he told The Times. Where Thatcher’s policies accelerated the decline of an industry many viewed as economically unviable, Neame argues that the chancellor is effectively destroying pubs that are “what people and communities want and need” and what Britain leads the world in delivering. The hospitality sector shed an estimated 89,000 jobs in the first nine months following Reeves’s maiden budget, according to an analysis of official jobs figures by UK Hospitality. The trade body predicts a further 100,000 jobs are at risk on the back of the chancellor’s announcements on the minimum wage and business rates, outlined in November’s budget. Neame said: “If 89,000 people in one factory lost their jobs, every single government minister would be down there to throw subsidies at it. But with pubs, it’s like we are a nuisance that has to be solved or put in a box by the government. You just need to turn the handle and growth will flow out of our sector.” Neame is very aware that his pubs need to be of star quality, in terms of the overall experience, to lure in a more cost-conscious punter. “There is no doubt that going out is an expensive thing to do now, for all the reasons we know. People will go out less frequently, but when they go out they will spend and have a good time. Therefore, we need to make our environments as good as they possibly can be.” He added: “I feel like we have got to an operational level that we could only aspire to a few years back, but that doesn’t necessarily translate to the bottom line because there is so much going on elsewhere.”

The Telegraph launches campaign to save pubs: The Telegraph newspaper is launching a campaign to save pubs. It said: “Over 200 years have passed since Samuel Johnson declared: ‘There is nothing which has yet been contrived by man, by which so much happiness is produced as a good tavern or inn.’ His words are as correct today as they were then. For communities up and down the country, pubs remain at the heart of local life, providing a place to meet with friends, meet with strangers, or enjoy a quiet drink at the end of a long day. The honour of these establishments is fiercely defended by their patrons, who can articulate at great length the subtle details which justify their preference of one house over another. Regrettably, this affection is not shared by this government. Pubs which have withstood centuries of ill fortune from war to pestilence are now crumbling as a direct result of Sir Keir Starmer and Rachel Reeves’s sustained assault on their viability. The Telegraph view is that these fine institutions deserve better, and we are therefore launching our campaign to save the British pub. A change in course is desperately needed. At least one pub each day is expected to close this year as the chancellor’s policies take their toll. Those businesses which weathered the covid storm, and the energy price shock that followed, suffered considerable damages to their finances which are still being repaired. Yet Ms Reeves has announced that the business rates relief for the hospitality sector will come to an end, adding to the burdens faced by pubs still counting the cost of the employers’ National Insurance hike, an increase in alcohol duty and a rise in the minimum wage. The news that the government is planning to cut the drink driving limit in half, potentially making a single pint after work legally perilous, is likely to make things worse, in particular for rural pubs which may already be struggling to meet their rising costs. It is a policy with apparently little evidence backing it. The number of collisions where drink driving is involved, and the number of casualties resulting, are both in long term decline. Our roads are far safer now than they were in the past, and as technology improves will only become more so. These measures are not needed: the limits are fine as they stand. The government should change course, scrap these plans and cease its assault on pubs.”

Pubs are pumped up by signs of more support: Britain’s pub sector suffered last year, with an average of one pub a day closing its doors for good in England and Wales amid crippling employer tax rises. However, The Times reports that pub stocks received a boost yesterday amid speculation that the government is looking to provide support to the sector, which is facing an extra £160n annual tax burden from reforms to business rates. Tom Wells, the prime minister’s spokesman, said the government was mulling cutting red tape and licensing reforms for pubs, according to Bloomberg. Investors took it as good news, with JD Wetherspoon, the no-frills chain, rising 8½p, or 1.1%, to 760½p. Mitchells & Butlers, which owns the All Bar One and Toby Carvery brands, added 5p, or 1.9%, to 272½p and Young’s closed up 19p, or 2.6%, to 760p.

Stricter drink-drive limit for new drivers means no pints or wine: Novice motorists will face a stricter drink-drive limit, meaning they will not be able to risk having a single pint or small glass of wine before getting behind the wheel. The Times reports that the effective ban on driving after drinking alcohol for recently qualified drivers will make the UK one of the strictest countries in Europe. Ministers will announce that the limit of 80mg per 100ml of blood will be cut to just 20mg for learners and those in their two-year probationary period. The limit will be cut to 50mg, the same as in Scotland, for all other motorists as ministers seek to more than halve the number of people killed and seriously injured on British roads each year. Nowhere else in Europe has a limit above 50mg per 100ml. The measures for young people are part of the government’s road safety strategy, which is being unveiled later today (7 January).