Licenced premises down by a third since 2003

By Andrew Catchpole

Published: 30 October, 2023

The number of licenced premises in Britain has fallen below 100,000, marking a 31% decline in the two decades since 2003.

The new figures, from UK Hospitality (UKH) and CGA by NIQ, point to the loss of 44,000 net outlets to the end of September 2023, equivalent to six closures on average every day over the past 20 years, down to 99,916.

UKH said the figures “highlight the seismic changes” in hospitality, down to the pressure the industry has been working under, with those challenges “exacerbated by soaring inflation, rising energy bills and workforce challenges”.

Hardest hit have been drink-led pubs and bars, revealing a net decline of 43.6% over the period, although managed venues (up 14.6%) and food-led pubs and casual dining outlets have grown (up 14.8%), reflecting a clear and ongoing trend from drinking out to eating out.

Karl Chessell, CGA by NIQ’s business unit director – hospitality operators and food, EMEA, said: “These figures show the steady contraction of Britain’s licensed premises over a 20-year period and that has accelerated in recent years with the triple whammy of Brexit, Covid and spiralling costs. But while the closures have negatively impacted communities and livelihoods, some trends have been positive, like the dramatic increase in the quantity and quality of restaurants and the success stories of multi-site operators.

Chessell called for greater government support for the sector, as did Kate Nicholls, CEO of UKH.

Nicholls added: “Given the shocking number of hospitality business closures exposed by these new figures, the last thing the sector needs is the potential £1 billion bill as a result of the business rates hike due in April. Our industry has proved time and time again that, with the right conditions, it can drive national economic growth, invest in local communities and create jobs at all levels.

“The Autumn Statement is an opportunity to extend the current business rates relief and freeze the current multiplier. In doing so, it can not only save more local and national businesses from closure but enable investment and growth.”

Meanwhile, in separate market analysis, the British Beer and Pub Association (BBPA) forecast that around 750 pubs would close their doors for good in the first half of 2024, impacted by rising costs, including an average hike in business rates of £12,385.

“The closures would be a significant 87.5% increase on the 400 pub closures recorded in the first six months of 2023,” warned the BBPA.

The relief offered by the current 75% discount on business rates is due to end on 31 March 2024, which UKH estimates will create a £850m additional burden in uplifted rates, compounded by an inflation-linked rise in April, adding another £234m.

Sacha Lord, night time economy adviser for Greater Manchester, has also called for the business rates relief to be renewed.

He said: "The impact of the upcoming Autumn statement should not be underestimated. In a high-inflation, challenging economy, the decision whether to freeze the current business rates relief will be the difference between the sector growing or retracting, and without this commitment, the government's pledge to increase economic growth ahead of the next general election will not come to fruition."

In addition, Lord called on the Chancellor to review VAT tax breaks and create parity between retail and service sectors.

“Hospitality cannot be sustained in this environment where varying tax breaks between the two sectors create such an uneven playing field. As the pandemic has shown, society is changing and rather than viewing sectors in silo, we need to reform systems and install fair economic solutions which benefit both. Reducing VAT for hospitality would be a clear signal that things can change for the better,” he said.

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