Since the beginning of the energy crisis, members of the trade organisations have faced a raft of business-critical challenges, with 50% being forced into contracts between July and December 2022, in an uncompetitive market when energy prices were at their highest.
Hospitality trade bodies, the British Beer & Pub Association (BBPA), UKHospitality (UKH) and the British Institute of Innkeeping (BII) have written to Amanda Solloway MP, the Minister for Energy Consumers and Affordability, calling for urgent Government support for hospitality businesses on the brink of collapse.
Ofgem, the industry regulator has investigated evidence from hundreds of pubs and hospitality businesses, showing the unfair nature and length of contracts, sky high standing charges and management fees, and aggressive sales tactics by some energy suppliers, but the action taken so far has been too little, and for many will be far too late.
A spokesperson for the trade bodies stated:
“Following any meaningful Government support tailing off at the end of March, operators now face bills between three and four times higher than in 2021, locked into contracts that are destroying their otherwise viable and vibrant businesses.
“We have been engaging with Government Ministers and officials, as well as Ofgem, for over a year now, sharing the often-immoral behaviour of energy suppliers, whose actions have plunged pubs and hospitality businesses into debt and uncertainty. Domestic customers have been protected to some extent, but small businesses supporting families and communities have been left exposed to untenable costs and contracts, threatening livelihoods the length and breadth of the UK.
“Ofgem’s limited powers leave it unable to intervene in contracts between these suppliers and hospitality businesses. We are calling urgently on Government to step in and take action to save essential community hubs and thousands of jobs from being lost forever.”