Budget helps hospitality firms ‘cut costs’ but Chancellor ‘should have gone further’, says Sheffield pubs boss
The Chancellor has helped the hospitality sector to ‘cut costs’ in his spring Budget but ‘should have gone further’, the boss of one of Sheffield’s biggest food and drink operators has said.
Rishi Sunak announced a series of measures today aimed at assisting pubs, bars, restaurants and similar businesses hit hard by the pandemic.
VAT bills on food and non-alcoholic drinks will remain reduced to five per cent until September 30, with the rate only then increasing to 12.5 per cent until next April. The business rates holiday is being extended until the end of June, while hospitality firms will be entitled to grants of up to £18,000 per site, as well as ‘recovery loans’ worth anything from £25,000 to £10 million.
Alcohol duty has also been frozen for another year.
Kane Yeardley, managing director of True North Brew Co which runs 12 venues in Sheffield and beyond, including The Broadfield on Abbeydale Road, The York in Broomhill and The Forum on Devonshire Street, said the duty freeze was ‘good news’ and the rates and VAT measures would be ‘helpful to cut costs’, but added: “He should have helped people with their rents. He should have gone further to help people get deals with their landlords.”
The grants, he suggested, would not be enough to cover expenditure when places can welcome customers again.
“Many sites are not on the higher rates so the £18,000 will be more like £8,000. For many businesses it costs a lot more to restock a pub or restaurant – anything from £20,000 to £40,000.”
And the loans were just that, he added. “People have got to work hard to pay them back.”
Kane expressed disappointment that the Chancellor made no mention of reviving last year’s Eat Out to Help Out initiative, under which the Government picked up the tab for discounted meals and soft drinks eaten on the premises of pubs, cafes and restaurants.
“That would have been really helpful to kickstart people's confidence,” said Kane.
Ahead of the Budget, it was mooted that the Chancellor was considering setting a higher alcohol duty rate on drink sold in supermarkets rather than pubs, but this did not come to pass. Kane said he would have backed such a move.
“People feel we're charging too much but supermarkets have a completely different cost structure,” he said.