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UKH urges government to issue on-trade rescue package

Published:  31 August, 2022

UKHospitality (UKH)chief executive Kate Nicholls has written an urgent letter to the UK government, outlining the potential disaster facing thousands of businesses in light of the energy crisis.

In the letter to chancellor Nadhim Zahawi and business secretary Kwasi Kwarteng, Nicholls writes: “Hospitality businesses are facing a crisis this winter, with soaring costs combined with a sharp drop in disposable incomes for our customers.

“Without support, the industry will see widespread business failure, leading to tens of thousands of job losses, persistent scarring to high streets and damaged social mobility.”

Nicholls has called upon on the chancellor and business secretary to introduce “a comprehensive package of measures to the end of March 2023,” including a business rates holiday for all hospitality premises, with no caps applied; deferral of all environmental levies; the reinstatement of a generous HMRC Time to Pay scheme; and the reintroduction of a trade credit insurance scheme for energy.

She also wants to see the April 2022 increase in the VAT rate for hospitality from 12.5% to 20% reversed, to help the economy to keep growing.

According to UKH, the sector currently employs more than 2.5m people, including some of the most sensitive to rapid inflation.

“Support has rightly been committed to households, but more must be done to help businesses, particularly SMEs, that are at risk of failure due to no fault of their own,” Nicholls said.

“Hospitality businesses had their resilience severely strained during the pandemic and are not able to weather the worsening storm they now face. Immediate intervention in the commercial energy market is essential to avoid dire consequences.”