I welcome the announcement that pubs will receive a 15% discount on the business rates they pay.
It recognises what pubs mean to our communities and our economy, and the real impact of revaluation at a time when costs are squeezing every last bit of headroom needed to survive.
After 7,000 pubs closed during 14 years of Tory government, Labour is taking action to turn the tide. And in our borough, the consequences weren’t just lost jobs, strained social connections, and falling footfall on our high streets — but also what too often followed: low-quality HMOs cramming rooms into every inch of buildings left empty.
But the pressures facing pubs are felt right across hospitality.
Restaurants, hotels, clubs, leisure centres and gyms, children’s soft play centres and more are all facing rising operating costs. This also highlights the impractical nature of business rates themselves. What is a pub? Many are no longer drink-led, yet those offering food often face the biggest increases. How many overnight rooms does a pub need before it becomes a hotel? What if a restaurant allows customers to stay for drinks without ordering food, or a hotel operates a large bar that functions exactly like a pub?
Take the “Egyptian Room” which to most people functions like a pub (free access, buy a standalone drink, main bar focus) and plays a vital role in Oldham’s social life, it is classified by the Valuation Office Agency as a “food court and premises,” not a pub for business rates purposes. Because the new 15% business rates support is tightly defined around properties officially classed as pubs, venues like the Egyptian Room and many others will not qualify, despite operating in the same hospitality ecosystem and facing the same rising costs.
To be clear; the valuation process is independent. Government then decides on what follows; how much business pay relative to that valuation, and what discounts, reliefs and exemptions are put in place to support priority uses and industries.
The government is doing so much work to support our town centres and high streets, for instance the Pride in Place funding, high street rental auctions, and more. But we’ve got to protect what we already have if we are to rebuild at a pace people can see.
I have urged the Treasury to look again and take this support further. After years of neglect under the previous government the foundations are weak, urgent cross hospitality action is needed before the shutters come down for good on our town centres.
This cannot be the final word on support for hospitality.
Jim McMahon OBE MP 