Editor’s Viewpoint: Chancellor’s April Hikes Are a Disaster – It’s Time for a Radical Rethink

By Peter Adams, Editor, CLH News.

A recent flash survey of UK businesses—revealing economic strain, plummeting confidence, and fears for survival—should send a chill down the spine of anyone who cares about the future of British hospitality.

As reported in our front-page feature and echoed by industry trade bodies, the message is clear: our sector is being bled dry. And yet, from the Government? Deafening silence.

The Chancellor’s April hikes—increases to the national minimum wage, national insurance, and a cruel scaling back of business rates relief—are nothing short of disastrous.

They are short-sighted policies delivered with a tin ear to the cries of small and medium businesses, the very backbone of our economy. The sentiment from those on the ground is one of anger, dismay, and exhaustion.

As the great American economist Thomas Sowell once said, “It is hard to imagine a more stupid or more dangerous way of making decisions than by putting those decisions in the hands of people who pay no price for being wrong.” And to our minds, that quote encapsulates the problem—past, present, and no doubt future.

Too often, decisions with sector-wide consequences are being made by individuals with little, if any, experience of running a business. Yet they hold the levers of policy that can destroy, in one sweep, what’s taken lifetimes—or even generations—to build.

Here in Dorset, the news that Beales, one of the region’s most iconic retail names, is to close its doors sent shockwaves not just locally, but across the country.

Its announcement of a “Rachel Reeves Closing Down Sale” laid bare the impact of what its Chairman called the “big three economic killers.” It’s a stark warning of what’s to come if policy doesn’t change—and fast.
It’s time for the Chancellor to change course. One immediate and effective measure would be a reduction in VAT for the hospitality sector.

Almost every EU nation has already done so, many years ago, and their hospitality sectors are all the stronger for it. Numerous economists agree: a lower VAT rate would not only safeguard jobs and businesses, but it would actually generate increased Treasury revenues over the longer term.

More than that, it would put the “feelgood factor” back into a weary nation. Spirits in this country are at the lowest many of us can remember. People want reasons to go out, to reconnect, to enjoy the communities around them. Hospitality is at the heart of that experience—but we need policies that nurture it, not punish it.
That said, it isn’t all doom and gloom. The recent reduction in interest rates is a welcome step, and signs suggest further cuts may be on the horizon.

Lower borrowing costs and more disposable income may yet offer a glimmer of hope for households and, in turn, for the hospitality sector. If the public has more to spend, our pubs, hotels, restaurants, and cafés may once again become the first choice for socialising and leisure.

But hope alone will not sustain an industry under siege. We need practical, immediate support—rooted in reality, not political soundbites.

A VAT cut would be a good start. Beyond that, we call for a longer-term review of employer costs, meaningful rates reform, and—crucially—a proper dialogue between Government and those who live and breathe this sector every single day.

We at CLH News are always interested to hear your views, and share them, raising all our voices, to call for policies that support, not sabotage, one of Britain’s most treasured and vital sectors.

I would encourage all our readers to follow us on X/Twitter @CLHNews and visit our website at www.catererlicensee.com to sign up for our twice weekly e-newsletter for all the latest news delivered directly to your inbox.

I can always be contacted at edit@catererlicensee.com