Business

MPs demand more government support for ailing hospitality sector



The UK Government was urged to create a dedicated minister for the hospitality industry as MPs debated a petition relating to support for the sector.

The petition, which has more than 189,000 signatures, states: “The UK hospitality industry is responsible for around three million jobs, generating £130bn in activity, resulting in £38bn in taxation. Yet, unlike the arts or sports, we do not have a dedicated minister.

“We are asking that a Minister for Hospitality be created for the current and successive governments.”

In response to the petition, the UK Government stated that responsibility for the hospitality sector is shared by ministers in the Departments for Business, Energy & Industrial Strategy (BEIS) and Digital, Culture, Media & Sport.

Paul Scully MP, Minister for Small Business, Consumers and Labour Markets at BEIS used his time during the debate to point out that it is down to the prime minister to create new ministerial positions, adding “whether or not we do, we need to ensure the sector is in the best possible place to bounce back from Covid-19”.

While he was non-committal on the petition proposal, Scully said he hears “the understandable cries of anguish from the hospitality sector”, but reiterated that while the industry brings people together, now is a time to stay at home.

“It’s going to be a tough few months, so we need to make sure we can offer hope to these businesses – we will continue to work with hospitality businesses to keep them going and build back better.”

Catherine McKinnell MP, Chair of the Petitions Committee, opened the debate by saying that the petition speaks to concerns that government lacks deep understanding of the nature of the hospitality industry.

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She argued that the sector has been crippled by repeated lockdowns, creating an “incredibly challenging situation”, exacerbated by the fact ministers have “switched the entire sector on and off at a moment’s notice”.

McKinnell added that stuck between two departments, a “one-size-fits-all mindset” is not appropriate for nightclubs, pubs, restaurants and hotels. “It requires focused representation within government – a seat at the top table.”

She concluded: “We need a longer term plan to help businesses plan their survival as the vaccine is rolled out – I would urge the government to commit to examining the inadequacies of its support in relation to hospitality.”

There were multiple calls for the government to extend tax breaks – cutting VAT and giving business rates holidays – and offer funding support for the sector.

Last week, the Chancellor announced that businesses in the retail, hospitality and leisure sectors are to receive a one-off grant worth up to £9,000.

Jane Hunt, MP for Loughborough, suggested that business rates relief for hospitality and leisure should be extended for a further year, and to include related businesses such as suppliers.

Greg Clark, MP for Tunbridge Wells, said that hospitality business ‘pay their way’ in taxes and need support. “If they manage to survive, they will thrive in future and repay funds set aside the last few months.”

Navendu Mishra, MP for Stockport, called on ministers to extend the furlough, stating that in Greater Manchester more than two thirds of hospitality operators have made, or expect to make, redundancies.

Julian Lewis, MP for New Forest East, proposed introducing a temporary hospitality industry recovery minister, adding that if it works well, it would be logical to make it permanent.

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McKinnell concluded the session by reiterating concerns that the government is not maximising the knowledge within the industry to get the response right.

“Government should want to engage, so a strong voice would be in their interest and I urge the minister to take it away and put it to the Prime Minister.”

Separately, the Scottish Government announced January top-ups for hospitality, retail and leisure businesses closed by level 4 restrictions.

In addition to the grants businesses receive through the Strategic Business Framework Fund, eligible businesses will also get a one off grant of:

  • £25,000 for larger hospitality businesses on top of the four-weekly £3,000.
  • £6,000 for smaller hospitality businesses on top of the four-weekly £2,000.
  • £9,000 for larger retail and leisure businesses on top of the four-weekly £3,000.
  • £6,000 for smaller retail and leisure businesses on top of the four-weekly £2,000.

For the majority, this top-up will be combined with the next tranche of payment for the Strategic Framework Business Fund due to go to businesses on 25 January.

Finance Secretary Kate Forbes said: “This essential funding will help to close the gaps in UK wide support for these impacted sectors and our one-off support for larger hospitality premises of £25,000 is considerably more generous than the £9,000 grant on offer in England.

“I’d encourage all eligible businesses to apply through their local authority if they have not done so already.”



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