After being barred from her local, Chancellor Rachel Reeves’ Treasury has announced a major support package for England’s pub sector. It follows warnings of mass closures and job losses
Pubs will get 15% off their business rates bills from April as part of a major support package, the Treasury has announced. It follows grim warnings from the sector that changes from November’s autumn Budget would lead to mass closures and job losses.
Treasury minister Dan Tomlinson said the property tax bills in England will then be “frozen in real terms” for the next two years. He added that the support will be worth £1,650 for the average pub next year.
The package is reportedly expected to be worth nearly £100m for pubs and gig venues. Chancellor Rachel Reeves has been under pressure to offer a lifeline to the pub industry after officials admitted they had not foreseen the impact of the Budget’s changes to business rates on the sector.
She has been barred from her local pub, the Marsh Inn in her constituency of Leeds West and Pudsey, as part of a campaign by landlords to ban Labour MPs in the wake of the business rates row.
The Treasury’s intervention comes after an intensifying backlash from industry bosses and MPs over impending tax increases. Industry groups had warned that pubs in England are set to face a 76%, or £7,000, increase in their business rates bills in the next three years as a result.
As well as earmarking the cash for pubs, ministers are trying to sell its message that licensing reforms – including allowing extended hours – will help the industry. The wider hospitality industry has been lobbying for relief, but Mrs Reeves last week said the Government was focusing only on the pub sector.
She said: “I do recognise the particular challenge that pubs face at the moment, and so have been working with the sector over the last few weeks to make sure that the right support is in place. I think the situation the pubs face is different from other parts of the hospitality sector.”
Soaring overheads for landlords have meant one pub a day closed for good in England and Wales last year. Bars have been crushed in recent years by other increases in costs including higher employer national insurance contributions, rises in the minimum wage, inflation and supply costs.
Mrs Reeves announced a £4.3billion support package in her budget that included giving relief to businesses. It was intended to offset the end of a Covid support scheme that had reduced bills by 40%.
But it has not been enough to offset skyrocketing property tax bills caused by the first revaluations of properties since the pandemic from April.
Dozens of MPs are up in arms over the imminent closure of pubs across the nation. Andrew Griffith, the shadow business secretary, blasted: “Labour is scrambling to announce this package but it’s a sticking plaster solution when the patients are bleeding out all over our high streets.
“It’s taken them weeks to make this partial U-turn on the chancellor’s budget, during which thousands of retail and hospitality businesses have been staring down the barrel of disaster.”
Mrs Reeves has said she was “particularly concerned” about the impact of business rate changes on pubs and they remained her “biggest concern”.
Labour MP Carolyn Harris, who is also chair of the cross-party group on UK spirits, said: “Pubs are more than pints. Landlords tell me that spirits are crucial to their profitability. Amongst the higher costs pubs are facing is yet another hike in excise duty hitting their bottom line.
“We cannot support pubs and hospitality if the spirits sector isn’t empowered to thrive.”
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