Standing up for the Hospitality industry

 

The hospitality industry is the third largest employer in the UK, employing about 3.5 million people and contributing £93 billion to our economy. In 2022, hospitality generated £54 billion in tax receipts, £20 billion in exports, and attracted £7 billion in business investment. Put simply, hospitality matters, for our economy and for people’s livelihoods. 

During the pandemic, the sector was strongly supported by the then Conservative Government, with hundreds of thousands of jobs saved. Since the pandemic, the sector has faced significant challenges. Inflation, especially in relation to energy costs and rising food prices, has had a major impact.

The Labour Government’s Budget a fortnight ago could be ‘the straw that breaks the camel’s back’. At the weekend, a large number of industry leaders from the hospitality sector wrote to the government, highlighting their “grave fears” about the impact of the Budget.

Their letter makes for stark reading. They are concerned about the increase in Employers National Insurance, especially relating to the much-reduced threshold that it will paid at. They say that alongside the changes to the national minimum wage levels, these changes this will cost the hospitality sector an estimated £3.4bn a year.

That is not sustainable given the existing pressures. The sector, and with it thousands of jobs, are staring into the abyss. The letter says that the changes to the Employers NI threshold are regressive in their impact on lower earners and will impact flexible working practices which many older workers and parents rely upon. Quoting from the letter, they say “Unquestionably they will lead to business closures and job losses within a year.” 

The letter goes on to state that there is no capacity to pass the costs onto customers, as businesses would be reluctantly forced to raise prices by 6-8% which would fuel inflation, but this couldn’t be realistically done as many customers are at the end of their ability to pay more.

Tragically, unless the Labour Government reconsiders at least their reducing of the threshold that Employers NI is paid at, I fear a wave of future closures in Crawley and beyond in hospitality.

Keep the single person's 25% Council Tax discount - a basic principle of fairness

It was 1993 when council tax became the method of how households pay towards local government services and policing. A case can be made for updating how local government is financed, including updating from the 1991 banding valuations, but I am concerned that the Labour government are going to make a dog’s breakfast of it and introduce much unfairness into the system.

Of concern is that Labour’s Deputy Prime Minister Angela Raynor, as well as subsequently Keir Starmer, have not ruled out ending the 25% council tax discount for single-adult households, when asked about it in parliament. I don’t rate her as being particularly competent, so it is possible she didn’t answer correctly, but as I write, she hasn’t issued any correction or clarification, which makes me fear that it very much is an option being considered.  

Nationally, there are 8.4 million people who live in single-adult households. About 4 million of these are pensioners, many of whom are widows or widowers. On average across West Sussex, the 25% discount is worth roughly £500 for a Band-D property, compared with properties of two or more adults. Clearly, households with only one adult use less local government services than those with two or more, so it’s basic fairness that these households pay less.

It could be argued the single-adult discount should be more than 25%, but the discount being 25% is long established. What would be an absolute travesty is removing the single-person discount alltogether, meaning that for example, an elderly widowed pensioner on a basic state pension, could be paying the same as a household next door with two or more working people on good salaries.

If Labour are now targeting single people in their budget next month, it risks being a triple whammy for many pensioners, who are still reeling from being told they won’t be receiving their winter fuel allowance. October is when energy costs rise by 10%, just as the days are getting shorter and the cooler weather arrives. All single people have greater challenges running their household and I strongly urge the Labour government not to remove their 25% council tax discount.  

Campaigning to stop Labour taking away Pensioner's Winter Fuel Allowance

Two things in politics that sit badly with the public are hypocrisy and being disingenuous. Unfortunately, many now see this as the ‘new normal’ under the Labour government that will become two months old this week. Cheered on by their enormous number of MPs and councillors, who now wield a huge amount of power over our lives, we are seeing decisions being taken by Labour that they have previously opposed and/or have falsely accused the Conservatives of planning to do.

The internet does not forget. There are many Labour videos and social media posts while they were in opposition, including of Keir Starmer and Angela Raynor, blaming the Conservatives for rising energy prices and implying we Conservatives would take away the winter fuel allowance for pensioners. During the energy price spike, the then Conservative government put in place measures to subsidise household energy bills to lessen the financial pain. Thankfully prices then reduced although they are still high by historical standards.

However, when it was recently announced that energy bills would be rising by 10% from this October, out trots Labour still blaming the Conservatives. As well as not providing the major energy support for all households that the Conservatives did, Labour are now taking away the winter fuel allowance from ten million pensioners, worth up to £300.

We Conservatives strongly oppose this poorly judged measure. I welcome that as a party, we are challenging this decision in parliament. What will help is public pressure. I have signed the Age UK petition and I encourage everyone to do so. 

What is especially galling is that Labour are falsely blaming the Conservatives for leaving a black hole in the public finances, for removing the winter fuel allowance, when it is Labour creating a budget black hole, by instantly caving in to inflation-busting (and probably inflation-creating) pay demands from trade unions. It is no coincidence that trade unions are the biggest financial backers of the Labour party and their MPs.