Pub owners in Northumberland are expressing grave concerns over potential business closures due to significant increases in business rates, despite a government discount. The support offered is seen by many as insufficient to offset rising operational costs, including energy, staffing, and supplier expenses.
Key Takeaways
- Pubs and live music venues will receive a 15% discount on new business rate bills from April.
- Despite the discount, some pubs face rateable value increases of over 100%.
- The support package excludes other hospitality businesses, which are also experiencing cost pressures.
- Industry figures warn that the current financial climate could lead to widespread closures of independent establishments.
Business Rates Set to Soar
Chancellor Rachel Reeves has announced a 15% discount on business rates for pubs and live music venues starting in April, a move intended to prevent a wave of closures. However, publicans like Robbie Morgan, who owns The Half Moon Inn in Stakeford and The Schooner in Amble, argue this measure falls short. Morgan’s The Half Moon Inn is set to see its business rates jump from £27,250 to £60,000 – a 120% increase. The Schooner will face a 32.1% rise.
Morgan stated that even with the 15% discount, the new bills remain substantially higher than before, questioning the effectiveness of the support. "It doesn’t feel like real support, it just looks like support on paper," he commented.
Broader Economic Pressures
The hospitality sector is grappling with a confluence of rising costs. Staff wages, brewery prices, and expenses across the food supply chain are all increasing. Morgan highlighted that these escalating costs make operating a hospitality business more expensive than ever, predicting a difficult year for independent venues.
He added that despite efforts to improve business performance and attract more customers, the increased revenue is largely absorbed by higher rates and operational expenses, making profitability a significant challenge.
Political Response and Concerns
Councillor Guy Renner-Thompson, representing the Bamburgh ward and chairman of Northumberland Conservatives, criticised the government’s offer as "derisory." He pointed out that for some pubs in Seahouses, rateable values are increasing by 50% and as much as 430% from their 2023 valuations. He also noted the lack of support for other hospitality businesses, such as hotels, citing the Victoria in Bamburgh which faces a 70% increase in its rateable value.
Renner-Thompson linked these rate increases to rises in the minimum wage, national insurance, and alcohol duty, which have forced pubs to increase prices, potentially deterring customers. He described this as a "downward spiral" leading to numerous pubs being put up for sale in Northumberland.
The Chancellor’s announcement follows previous budget changes that were expected to increase business rates due to property revaluations and the phasing out of Covid-era relief. The government has pledged a new High Street Strategy aimed at supporting retail, leisure, and hospitality businesses, with Ms Reeves expressing a commitment to helping these sectors thrive and restore pride in local communities.
Sources
- Northumberland pub owner fears business rates rise could spark closures, Northumberland Gazette.
