I am proud that the UK has one of the most dynamic and diverse hospitality sectors globally. But for a sector that exists to bring people together, the impact of Covid-19 was always going to be considerable and that is why the Government introduced its first ever Hospitality Strategy last year which enables the sector to build back better.
The Strategy focussed on reopening, recovery and resilience with an additional £5 billion worth of grants. Ministers have been working with the Government-owned British Business Bank and its delivery partners to support access to finance, while working alongside the Hospitality Sector Council, comprising businesses, sector representatives and industry leaders, to oversee the strategy’s delivery.
You will be reassured to know that through the new Energy Bill Relief Scheme, the Government will provide a discount on wholesale gas and electricity prices for all non-domestic customers whose current gas and electricity prices have been significantly inflated in light of global energy prices. This will include all UK businesses and will be equivalent to the Energy Price Guarantee put in place for households.
This will see the Government set a Supported Wholesale Price which is a discounted price per unit of gas and electricity. This price has been set at £211 per MWh for electricity and £75 per MWh for gas, less than half the wholesale prices anticipated this winter.
It will apply to fixed contracts agreed on or after 1 December 2021, as well as to deemed, variable and flexible tariffs and contracts. It will be applied until 31 March 2023, running for an initial six-month period for all non-domestic energy users. The savings will be first seen in October bills, which are typically received in November.
In April 2023, the EBRS will be replaced by the Energy Bill Discount Scheme (EBDS) will run until March 2024. The EBDS will support businesses and other non-domestic customers by providing a discount on gas and electricity unit prices. Eligible consumers will receive a per-unit discount to energy bills during the 12-month period from April 2023 to March 2024. The relative discount will be applied if wholesale prices are above a certain price threshold. For most non-domestic energy users in Great Britain and Northern Ireland these maximum discounts have been set at:
- electricity - £19.61 per megawatt hour (MWh) with a price threshold of £302 per MWh.
- gas - £6.97 per MWh with a price threshold of £107 per MWh
Moreover, small businesses will be shielded from most tax rises and will be protected from increases through the Small Profits Rate and Employment Allowance. This means only the largest ten per cent of companies will pay the top rate of Corporation Tax and 40 per cent of all businesses will be unaffected by the freeze in National Insurance thresholds.
Finally, there is also a £13.6 billion package of support. To protect businesses from rising inflation the multiplier will be frozen in 2023-24 while relief for 230,000 businesses in retail, hospitality and leisure sectors was also increased from 50 per cent to 75 per cent next year.
The Government has supported more than 5 million apprenticeship starts in over 650 high-quality standards, ensuring career goals they can be achieved through an apprenticeship. Ministers are going further boosting funding to £2.7 billion by 2024-25, and rolling out and expanding T levels, Institutes of Technology, and skill boot camps – all backed by £3.8 billion. The Government is on the side of business and that is why its skills programmes have been designed with employers to meet the needs of business and industry.
Any decision to modify our tax regime is a matter for the Treasury and careful consideration will be given to any proposed amendments to current tax rates. I understand that the Government keeps all taxes under review. I shall be following any developments on this issue closely.
From 1 April 2023, business rate bills in England will be updated to reflect changes in property values since the last revaluation in 2017. A package of targeted support worth £13.6 billion over the next five years will support businesses as they transition to their new bills, protect businesses from the full impact of inflation, and support our high streets. English Local Authorities will be fully compensated for the loss of income as a result of these business rates measures and will receive new burdens funding for administrative and IT costs.
In relation to visas, I appreciate the concerns however issues with recruitment in the hospitality sector are not unique to the UK, and I understand there are reports of similar issues in the USA, the Republic of Ireland and Spain. This indicates factors other than immigration policy need to be considered to resolve these issues.
As you may know, several roles in the hospitality sector, including chefs and managerial roles, are eligible for the Skilled Worker route in the Points Based System. The modelling produced by the independent Migration Advisory Committee (MAC) suggest the new, lower salary and expanded skills thresholds, strike a reasonable balance between controlling immigration and business access to labour.
I understand other roles will need to be filled from the resident workforce and those with full work rights, including the 6.5 million applicants under the UK's EU Settlement Scheme, dependants of work visa holders, and those coming to the UK under the new Ukraine Schemes, the British National (Overseas) route, the Graduate route and Youth Mobility Schemes.
You may be interested to know that further advice from the MAC has been against the creation of sector specific visa routes.