Pub trade warns of 2,000 closures without budget aid

Published

2 years ago

March 1, 2023

admin

A further 2,000 pubs are at risk of closure, threatening 25,000 jobs, unless the chancellor comes to the sector’s aid in this month’s budget, according to an industry body.

The British Beer and Pub Association (BBPA) cited research by Oxford Economics which forecast 288 million fewer pints would be sold in the next financial year as the cost of living crisis facing punters combines with the cost of doing business crisis.

Sales volumes have already slipped as the squeeze on household budgets forces more people to drink and eat at home.

The BBPA told Sky News that 450 sites closed last year alone as energy-driven inflation accelerated, despite government support.

It builds on a significant decline since 2000, with a quarter of pubs – 13,000 – being lost.

The BBPA used a submission to chancellor Jeremy Hunt, in advance of his budget on 15 March, to declare that financial support for publicans, breweries and staff training to retain workers were vital, arguing that the pub is at the core of British society.

It pointed to rising energy, food and employment bills among the reasons why costs are unsustainable.

“With cost pressures and slowing consumer spend, combined with a further duty increase in August, there are significant fears of widespread closures, with a worrying 2,000 pubs estimated to be at risk,” its statement said.

“And with the current Energy Bill Relief Scheme support ending on 31st of March, many pubs and breweries will again be subject to rocketing bills that threaten them to declare last orders once and for all.”

It said that one pound in every three spent in pubs currently made its way to the Treasury.

The BBPA’s wishlist included a freeze to duty rates and a “significant increase” in the discount for draft beer sold in pubs.

Publican Emma Shepherd, who runs the Blue Ball Inn in Worrall near Sheffield with her husband, has campaigned for more financial aid for the hospitality sector.

She described how soaring energy prices had already forced the closure of its kitchen on two days per week despite government support for energy costs.

She warned that the prospect of any easing from April could mean they have to let staff go and shut the kitchen.

“We’re in a perfect storm… working harder for less,” she explained, describing how beer, food and local regulations had added to their expenses.

“20% VAT on everything is a huge cost to small businesses that are working on small margins and the margins are getting smaller,” she said.

“The government hailed a reduction for beer tax but we don’t see a reduction at our end because the beer producers are facing the same energy costs as we are.”

Emma McClarkin, the chief executive of the BBPA, said pubs in rural areas were at particular risk, leaving more communities facing the prospect of being without a local.

“This really is a make or break moment for our pubs and our brewers,” she said.

“With everything that’s hitting them at the moment post pandemic, recovery has been really, really difficult and with cost inflation biting, labour shortages as well as those high energy costs, we’re really struggling to find our feet again as an industry… without that intervention (from the government) we could lose 2,000 pubs and 25,000 jobs.”

Business

MPs to debate emergency law to keep British Steel open as prime minister warns national security ‘on the line’

Published

2 hours ago

April 12, 2025

admin

MPs to debate emergency law to keep British Steel open as prime minister warns national security 'on the line'

MPs will today debate emergency laws to save British Steel after the prime minister warned the country’s “economic and national security is on the line”.

Sir Keir Starmer said the future of the company’s Scunthorpe plant – which employs about 3,500 people – “hangs in the balance” after its owner said the cost of running it was unsustainable.

The prime minister said legislation would be passed in one day to allow the government to “take control of the plant and preserve all viable options”.

Follow latest: Live politics updates

MPs and Lords are being summoned from their Easter recess to debate the move and will sit from 11am.

The last time parliament was recalled was on 18 August 2021 to debate the situation in Afghanistan.

The government has been considering nationalising British Steel after Jingye, the Chinese owner, cancelled future orders for iron ore, coal and other raw materials needed to keep the blast furnaces running.

The furnaces are the last in the UK capable of making virgin steel.

Jingye last month rejected a £500m state rescue package – raising fresh doubts about the Lincolnshire plant and fears it could close in the coming days.

The steel from the plant is used in the rail network and the construction and automotive industries. Without it, Britain would be reliant on imports at a time of trade wars and geopolitical instability.

In a statement on Friday, Sir Keir said: “I will always act in the national interest to protect British jobs and British workers.

“This afternoon, the future of British Steel hangs in the balance. Jobs, investment, growth, our economic and national security are all on the line.”

The prime minister said steel was “part of our national story, part of the pride and heritage of this nation” and “essential for our future”.

He said the emergency law would give the business secretary powers to do “everything possible to stop the closure of these blast furnaces”.

This includes the power to direct the company’s board and workforce. It will also ensure it can order the raw materials to keep the furnaces running and ensure staff are paid.

Chancellor Rachel Reeves said the government was “taking action to save British steel production and protect British jobs”, while Business Secretary Jonathan Reynolds said the owner had left the government with “no choice”.

Mr Reynolds said Jingye had confirmed plans to close the Scunthorpe furnaces immediately despite months of talks and the offer of £500m of co-investment.

The company said it had invested £1.2bn since taking over in 2020, but that the plant is losing £700,000 a day.

Conservative leader Kemi Badenoch said the government had landed itself in a “steel crisis entirely of their own making”.

She said when she was business secretary, she had negotiated a plan with British Steel “to limit job losses and keep the plant running”.

Ms Badenoch said the government had “bungled the negotiations, insisting on a Scunthorpe-only deal that the company has deemed unviable”.

She added: “Keir Starmer should have seen this coming. But instead of addressing it earlier in the week when parliament was sitting, their incompetence has led to a last-minute recall of parliament.”

The Unite union said the prime minister’s recalling of parliament was “absolutely the right thing to do to begin the process of nationalisation”.

While the government hasn’t confirmed those plans, the chancellor also said earlier this week that “all options” are on the table.

Sky News understands accountancy firm EY is being lined up to play a role in a nationalisation process.

The government’s intervention over British Steel comes six months after the last blast furnace was closed at Port Talbot in Wales.

Plaid Cymru has questioned why the government didn’t take similar action there.

The party’s Westminster leader, Liz Saville Roberts, said: “Parliament is being recalled to debate the nationalisation of Scunthorpe steelworks.

“But when global market forces devastated Welsh livelihoods in Port Talbot, Labour dismissed Plaid Cymru’s calls for nationalisation as ‘pipe dreams’.”

Business

MPs to debate emergency legislation to keep British Steel open as ‘security is on the line’

Published

8 hours ago

April 11, 2025

admin

Sir Keir Starmer has said the government will debate emergency legislation on Saturday to keep the British Steel plant in Scunthorpe open as “our economic and national security is on the line”.

The prime minister added that “the future of British Steel hangs in the balance” and legislation will be passed tomorrow to allow the government to “take control of the plant and preserve all viable options” for it.

MPs and Lords are being summoned back from Easter recess to Westminster to debate draft legislation on the plans, and will sit from 11am on Saturday.

The government had been actively considering nationalising British Steel after Jingye, its Chinese owner in Scunthorpe, cancelled future orders for the iron ore, coal and other raw materials needed to keep the last blast furnaces in the UK running.

Follow latest: Live politics updates

Jingye also rejected a £500m state rescue package in a move which raised fresh doubts about the 3,500 jobs at the Lincolnshire plant – with it feared the site would be forced to close as early as next week.

The steel from the plant is used in the rail network and the construction and automotive industries. Without the plant, Britain would be reliant on imports at a time of trade wars and geopolitical instability.

In a short statement delivered from Downing Street this evening, Sir Keir said: “I will always act in the national interest to protect British jobs and British workers.

“This afternoon, the future of British Steel hangs in the balance.

“Jobs, investment, growth, our economic and national security are all on the line.”

‘A new era of global instability’

The prime minister added he has been to the site in Scunthorpe and met the steelworkers there.

He said he understands how “important steel is” to the “whole country” and continued: “It’s part of our national story, Part of the pride and heritage of this nation.

“And I’ll tell you this, it is essential for our future.

“[The government’s] plan for change means we need more steel, not less. So we will act with urgency… This situation and our response is unique.

“While it is true that we’re facing a new era of global instability, our concerns about this plant and negotiations to protect it have been running for years.”

Sir Keir said parliament will be recalled for a “Saturday sitting” and will “pass emergency legislation” in “one day” to give the business secretary the powers to do “everything possible to stop the closure of these blast furnaces”.

He added: “We will keep all options on the table. Our future is in our hands.”

Chancellor Rachel Reeves posted on X after the statement that the government is “taking action to save British steel production and protect British jobs”.

“We are securing Britain’s future,” she added.

Tory leader criticises Starmer

Business Secretary Jonathan Reynolds said this evening the Chinese owner of British steel has left the government with “no choice” but to act.

Jingye had confirmed plans to close the blast furnaces at Scunthorpe immediately despite months of talks and the offer of £500m of co-investment from the UK government, Mr Reynolds added in a statement.

It came as Conservative leader Kemi Badenoch said the government has landed itself in a “steel crisis entirely of their own making”.

“As business secretary, I negotiated a modernisation plan with British Steel to limit job losses and keep the plant running, including introducing an electric arc furnace in Teesside, similar to what we did with Tata at Port Talbot steelworks.

“However, the union-led Labour government have bungled the negotiations, insisting on a Scunthorpe-only deal that the company has deemed unviable. Keir Starmer should have seen this coming. But instead of addressing it earlier in the week when parliament was sitting, their incompetence has led to a last-minute recall of parliament.”

She added the government’s attempts to find a solution to the crisis are inevitably “going to cost taxpayers a lot of money”.

Meanwhile, the Unite union welcomed Sir Keir’s announcement by saying it is “absolutely the right thing to do to begin the process of nationalisation”.

The government has not confirmed plans to nationalise the company, but like the prime minister this evening, Chancellor Rachel Reeves said earlier this week that “all options” are on the table.

Unite general secretary Sharon Graham said this evening: “I am pleased that the government has listened to representations by Unite and other steel unions over the future of British Steel.

“Ministers could not have allowed a foundation industry to go under with the loss of more than 3,000 jobs and key skills… Discussions have been positive and whilst a longer-term plan needs to be developed, this gives workers the reprieve we have been asking for.”

‘When it was Wales, they mocked’

The government’s intervention over British Steel comes six months after the last blast furnace was closed at Port Talbot in Wales.

Welsh political party Plaid Cymru has questioned why the government did not take similar action to save that steelworks.

The party’s Westminster leader Liz Saville Roberts MP said: “Parliament is being recalled [on Saturday] to debate the nationalisation of Scunthorpe steelworks.

“But when global market forces devastated Welsh livelihoods in Port Talbot, Labour dismissed Plaid Cymru’s calls for nationalisation as ‘pipe dreams’.

“In a real emergency, governments step up to defend their strategic interests. Plaid Cymru recognised the importance of Welsh steelmaking. Labour chose to look the other way.

“When it was Wales, they mocked. Now it’s England, they act.

“Labour has taken Wales for granted for far too long – and the people of Wales won’t forget it.”

Business

UK economy grows – ONS

Published

20 hours ago

April 11, 2025

admin

The economy performed better than expected in February, growing by 0.5% according to official figures released on Friday, but comes ahead of an expected hit from the global trade war.

The standard measure of an economy’s value, gross domestic product (GDP), rose in part thanks to a suprisingly strong performance from the manufacturing sector, data from the Office for National Statistics (ONS) suggested.

Following the publication of the figures, the British pound rose against the dollar, jumping 0.4% against the greenback to $1.3019 within an hour.

Analysts had been forecasting just a 0.1% GDP hike in the lead-up to the announcement, according to data from LSEG.

Chancellor of the Exchequer Rachel Reeves described the results as “encouraging”, but struck a cautious tone when alluding to US President Donald Trump’s tariffs, and the economic volatility of the past week.

“The world has changed, and we have witnessed that change in recent weeks,” she said.

“I know this is an anxious time for families who are worried about the cost of living and British businesses who are worried about what this change means for them,” Ms Reeves added. “This government will remain pragmatic and cool-headed as we seek to secure the best deal with the United States that is in our national interest.”

But back in February, when Mr Trump was just beginning his second term in office, the UK’s economy looked to be on firmer ground.

Service sectors like computer programming, telecoms and car dealerships all had strong a month, while manufacturing industries such as electronics and pharmaceuticals also helped to drive GDP growth in February.

Car manufacturing also picked up after its recent poor performance.

“The economy grew strongly in February with widespread growth across both services and manufacturing industries,” said Liz McKeown, ONS Director of Economic Statistics.

While motor vehicle manufacturing and retail both grew in February 2025, they remain below February 2024 levels by 10.1% and 1.1% respectively

This aligns with industry data showing year-on-year declines in registrations and manufacturing.

“The UK economy expanded by 0.5% in February, surprising but welcome positive news,” said Hailey Low, Associate Economist at the National Institute of Economic and Social Research.

“However, heightened global uncertainty and escalating trade tensions mean the outlook remains uncertain, with a likely reduced growth rate this year due to President Trump’s “Liberation Day” announcements.”

Ms Low said that this could create a dilemma for Ms Reeves, who would face difficult decisions later in the year when the chancellor presents her next budget.

The latest data also shows a jump from January, when the economy was flat. And compared to the same month a year ago, GDP was 1.4% higher in February 2025.

You can receive breaking news alerts on a smartphone or tablet via the Sky News app. You can also follow us on WhatsApp and subscribe to our YouTube channel to keep up with the latest news.