By Peter Adams, Editor, CLH News.
The government’s recent amendments to its Employment Rights Bill are making waves, but in my humble opinion, they fail to address the elephant in the room.
The stark reality is that the hospitality sector simply cannot afford the proposed wage increases, no matter how much we value staff, how much we recognize deserved pay increases.
Time and again, ministers have pointed to their election mandate—a commitment to raising wages.
Fair enough. But the old adage attributed to Bernard of Clairvaux, “the road to hell is paved with good intentions,” comes to mind.
Intentions do not pay the bills. If a business cannot afford to give staff a pay rise, then that is the harsh reality, and no amount of rhetoric will change it.
As we approach April 1st, the alarm bells are ringing across multiple industries—hospitality, retail, and adult social care included.
The combination of increased employer National Insurance Contributions (ENIC), rising operational costs, and the new National Minimum Wage (NMW) levels are simply unaffordable.
What happens next? Job losses and reduced working hours. That much is blatantly obvious to everyone—except, it seems, to those in government.
The government now faces a difficult choice. It is unlikely to roll back the National Minimum Wage increases without political backlash.
However, it can and should reconsider other financial burdens, such as the additional employment costs being introduced. Increasing NMW it at the same time as reducing business rate relief and increasing employers’ national insurance contributions was an act of sheer folly.
The government can take meaningful action to support the sector in other ways—starting with VAT reduction. A lower VAT rate would stimulate consumer spending, keep businesses afloat, and ultimately result in higher treasury revenues.
Earlier this week, while exhibiting at a hospitality trade event, we had the opportunity to speak with seasoned operators.
Their message was clear: reducing the tax burden on businesses and consumers alike would have a far greater economic impact than arbitrary wage hikes.
They understand what the government seemingly does not—that a thriving hospitality sector benefits everyone. More spending, more jobs, more revenue. A win-win situation.
On that note, I urge everyone in the industry to get behind the British Institute of Innkeeping’s (BII) “Our Pub” campaign.
Over the past few years, numerous campaigns and lobbying efforts have highlighted the sector’s struggles.
While progress has been made, it is not enough. The government must hear us loud and clear—pubs and hospitality businesses are at the heart of every community, and they need fair taxation and tangible support.
So, rally your family, friends, and customers to support this initiative.
Let’s showcase the vital role our pubs play in local economies and communities, while shedding light on the financial challenges they face. The survival of the UK’s hospitality sector depends on it.
Every pub needs your support—let’s make our voices heard!