29/10/2026
Hospitality was let down today. But we cannot let it die on our watch.
Since 2021, the minimum wage has risen by 48%. The employer’s National Insurance bill for one full time minimum wage employee has risen by 162%. Altogether, the basic cost of employing that person has increased by 55%.
Food prices have risen by around 40%. Average commercial electricity costs have risen by around 65%, and for the smallest businesses they have more than doubled.
Businesses cannot keep absorbing these costs, but customers cannot afford endless menu price increases either.
Then there is VAT. On every £120 restaurant bill, £20 goes straight to the government before we have paid for the food, our team, energy, rent or rates.
There is a reason France, Spain and Italy charge hospitality VAT at 10%. The model simply does not work at 20%.
You can run a busy, successful, high turnover pub or restaurant and still lose money. That is not necessarily because you are bad at what you do. It is because the model is broken.
Today’s rates relief will help some small businesses, and I welcome that. But it does not come close to covering the increases in wages, National Insurance, food and energy. Much of it is temporary and it completely ignores the structural problem.
Andy Burnham said he would argue for hospitality VAT to be brought into line with Europe. He told our industry that the cavalry was coming. Today, he failed to deliver.
So we go again, and this campaign must now step up.
If you work in hospitality, have family in the industry, had your first job in it or simply value your local pub, restaurant or café, we need you with us.
It is now or never. We must force change before we lose our industry forever.
