Editor’s Viewpoint: The Chickens Come Home to Roost

By Peter Adams, Editor, CLH News.

Well, the warning signs were there in October 2024, written in black and white across the Chancellor’s autumn budget.

While Rachel Reeves spoke of “difficult decisions” and “rebuilding Britain,” those of us in the hospitality and licensed trade could see the storm clouds gathering on the horizon.

Now, as we move through 2025, those chickens are well and truly coming home to roost.

The brutal combination of National Insurance hikes, minimum wage increases, and the retention of business rates at punitive levels has created a perfect storm that is decimating our sector.

What the Treasury perhaps didn’t anticipate—or chose to ignore—was the cumulative impact these measures would have on an industry already operating on razor-thin margins.

Our lead story this month reveals the devastating reality: pubs are closing at their fastest rate since last summer, with 67 declaring insolvency in April alone—the highest number since 75 went bust last July. The Insolvency Service’s latest figures paint an even grimmer picture, with insolvencies jumping 15% year-on-year to 2,238 last month, and unfortunately, food and beverage services leading the carnage alongside construction, restaurants, and retail.

These aren’t just statistics on a spreadsheet; they’re the death throes of community institutions that have served as the backbone of British social life for generations.

The Chancellor’s budget may have been politically expedient, but it has proven to be economically naive.

You cannot simultaneously demand more from employers while expecting them to maintain employment levels and investment in their businesses. The mathematics simply don’t work, particularly in a sector where labour costs can account for up to 35% of turnover.

What’s particularly galling is that this was entirely predictable. Industry bodies, trade associations, and publications like CLH NEWS raised these concerns repeatedly throughout the budget consultation process. The warnings fell on deaf ears in Westminster, where the complexities of running a pub, restaurant, or hotel seem to be poorly understood by those crafting policy.

From the minute Rachel Reeves announced her budget, alarm bells rang throughout our sector.

Those bells continue to ring and are repeatedly ignored. As we reported last week, the number of job losses in May should have been enough for anyone with a modicum of common sense to see that current tax rates on businesses are simply unsustainable.

North West brewer Thwaites captures the industry’s exasperation perfectly in their annual report, warning of concerns over further tax increases in the next budget and declaring “Enough is Enough.” They are absolutely right.

As we survey the landscape of our industry today, the question isn’t whether these policies will cause damage—it’s how extensive that damage will be. Every week brings news of another closure, another redundancy consultation, another family business forced to call time after decades of service to their community.

But it’s not just the Chancellor’s tax raid that’s suffocating our sector. Our energy policy is equally destructive, and as a publisher, I can assure readers these costs are utterly unsustainable. Our Energy Secretary appears to be as indifferent to the damage his policies are inflicting as the Chancellor is to hers. Something really has to give.

The hospitality sector has weathered many storms: the smoking ban, the financial crisis, Brexit uncertainty, and the pandemic. Each time, we’ve adapted, evolved, and emerged stronger. But this feels different. This feels like death by a thousand cuts, a slow strangulation of an industry that employs over 3 million people and contributes £130 billion overall to the UK economy.

The Chancellor’s chickens are indeed coming home to roost. The question now is whether the government will have the courage to acknowledge its mistakes and take corrective action, or whether it will continue down this path of fiscal recklessness while our industry pays the price.

On a brighter note, I’d draw your attention to a wonderful initiative featured on page 16.

Hilton’s partnership with Aurora Foxes, a hospitality college and training hotel in Minehead that supports young people with learning disabilities, truly warmed my heart. I was rather taken aback to learn that while the UK has 1.5 million people with learning disabilities, only 5% are currently employed.

If ever there was an industry positioned to make a positive impact on this statistic, it’s hospitality. If you’re thinking of reaching out with similar initiatives, please do keep us informed—sharing the Hilton story has frankly been a real pleasure, and we hope to feature more as operators come on board.

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