NEWS FROM THE ALMR Expert Insights

The UK’s inflation rate continues to tick up, recently hitting a five-year high, which is bad news for operators across the licensed hospitality sector.

Why? As it stands, the Government calculates annual business rates increases based on September’s Retail Prices Index (RPI) rate. This current system of linking to RPI means that eating and drinking out businesses are collectively facing another massive increase in their business rates bills.

The ALMR is calling on the Government to bring forward its decision to assess business rates based on the Consumer Prices Index (CPI) rather than RPI, as soon as possible. One recent report estimated this would save pubs and restaurants around £40m in the first three years of the change.

The Government has announced that this switch will be effective from 2020, but they need to think again and push ahead right away if they want to ensure continued jobs, investment and growth from businesses across our sector.

RPI is even discredited by the Office of National Statistics itself, with its director general stating this summer that it was a “flawed measure” with serious shortcomings. It needs to be ditched at the earliest opportunity. Bringing forward the switch to CPI would help minimise cost pressures in the supply chain at a time of considerable economic and political uncertainty for the UK.

Recently, the ALMR joined forces with other industry bodies at an event for MPs in Westminster to speak with a united voice and highlight the continuing issue of rising

business costs. Many MPs signed a petition which, among other things, urged the Chancellor of the Exchequer to continue and increase the business rates relief for pubs in his forthcoming Budget, set for 22 November.

As a broader industry, we must make more noise on the inadequacy and inequity of the whole business rates regime, and the need for root and branch reform of this broken system. Operators of all types of venues across all trading styles must engage with their local MP and talk to their customers to bring this important issue into the spotlight. (If you need resources such as template letters to MPs, please contact us!)

The ALMR will continue to push the Government for support in the run-up to the Autumn Budget. This unfair tax punitively punishes traditional bricks and mortar businesses, while the likes of Amazon, Facebook and Google pay much less, relative to their size, turnover and profitability. The Budget is a prime opportunity to make a start on much-needed reform.

Kate Nicholls is CEO of the ALMR, the leading voice for the eating and drinking out sector.


The UK’s vital and vibrant hospitality sector must have its own dedicated Hospitality Minister, says the ALMR.

ALMR Chief Executive Kate Nicholls: “UK businesses are facing an unprecedented period of political and economic instability. Uncertainty, chiefly prompted by Brexit, is undermining businesses’ attempts to plan and invest and we need clear action from the Government to address this.

“The UK’s hospitality sector is the 3rd largest employer and incorporates a vast range of businesses and sub-sectors, not least of all the countries’ resilient and innovative eating and drinking out businesses. These are the business that have driven growth in local economies in every part of the UK, creating 1 in 6 of all new jobs since the recession.

“These businesses are looking ahead with a sense of trepidation as we approach Brexit and costs continue to rise. Issues important to our members, and the wider sector, straddle a number of different Government departments encompassing: employment, planning, taxation, food & drink, tourism and more. There is need for a national role to span these issues and ensure that crucial businesses are properly catered for.

“The Government must show leadership and support for these vital employers by creating a new role of Hospitality Minister to ensure transparent and useful engagement with businesses and promotion of the sectors’ interests. This will help promote a consolidated approach from both businesses and Government departments to help facilitate Brexit discussions and outcomes, and help inform the Government’s Industrial Strategy.”

Kate Nicholls ALMR Chief Executive


Following the announcement of an increase in the rate of UK inflation, the ALMR has once again called on the Government to ring forward its 2020 switch to CPI for business rates.

ALMR Chief Executive Kate Nicholls said: “Although the Office for national Statistics has announced an increase in the rate of CPI to a one-year high of 2.9%, there is still a pressing need for the Government to apply this measure of inflation to business rates at the earliest opportunity.

“The current system linking to Retail Price Index, a measure discredited by the ONS itself, needs to be ditched at the earliest opportunity. RPI stands at 3.9% currently, and this could see eating and drinking out businesses facing another massive increase in their business rates bills.

“The Government uses September’s RPI figures as the basis for indexation for business rates increases the following April, even when inflation peaks around September and falls back later in the year.

“A switch to CPI, along with a cap on inflationary prices similar to that introduced during the financial crash, could help minimise inflationary pressures in the supply chain at a time of considerable economic and political uncertainty for the UK.

“The Government intends to make this switch in 2020, but it needs to push ahead right away if it wants to ensure continued investment and growth from eating and drinking out businesses across the UK.”

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