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Hospitality industry urges new Prime Minister Liz Truss to ‘act quickly and decisively’ to save the sector

Published:  06 September, 2022

On Monday (5 September), Conservative Party members chose a new leader and, therefore, a new Prime Minister. Liz Truss secured 57% of the vote, defeating Rishi Sunak in the race to Number 10.

In her inaugural speech as leader, Truss vowed to tackle the energy bill crisis, which has plunged households and businesses across the country into uncertainty. 

She said: “I will deliver a bold plan to cut taxes and grow our economy. I will deliver on the energy crisis, dealing with people’s energy bills and the long-term issues we have on energy supply.”

The government has been repeatedly warned about the dangers the hospitality industry faces due to inflation and rising business costs.

Following the announcement of the UK’s new Prime Minister, Kate Nicholls, CEO of UKHospitality(UKH), said:

“We look forward to working closely with Liz Truss and the new cabinet in the coming weeks as we strive to save the hospitality industry, which is experiencing crushing cost rises.

“The new government must act quickly and decisively to address the soaring energy bills facing consumers and businesses. With the right package of support – including a reduction in the headline rate of VAT for the sector to 12.5%, a business rates holiday, the deferral of all environmental levies, the reinstatement of an HMRC Time to Pay scheme and the reintroduction of a trade credit insurance scheme for energy – the sector will be well placed to aid growth through generating jobs and local investment.

“Pre-pandemic, our industry spent £10bn a year in high-street regeneration and employed 3.2m people but with energy bills for hospitality businesses rising 300% on average – and as high as 750% in some cases – we desperately need a package of support put in place if we are to be able to play our part in the UK’s economic recovery and growth.”

Miles Beale, chief executive of the Wine and Spirit Trade Association, added: “It is great to hear that Liz Truss has a “bold plan” to grow the economy through tax cuts and reform. To help get the UK working, building and growing the new PM needs to ensure the alcohol duty review reduces red tape, boosts SME’s and keeps the UK as a central hub for the wine and spirit trade.

“Our hard-working UK wine and spirit businesses will be delighted to hear the Prime Minister vowing to “cut taxes to reward hard work”. These businesses have faced an unprecedented tough trading environment following Brexit and the pandemic.

“We look forward to the new government dealing with the energy crisis, which will hit wine and spirit businesses – and hospitality generally – hard. More government support will allow businesses to recover, invest and grow.”