Hospitality Sector

Gareth Thomas Excerpts

Wednesday 3rd September 2025 Commons Chamber

[The Parliamentary Under-Secretary of State for Business and Trade (Gareth Thomas)]

Only yesterday I sat down with some of Britain’s great publicans—award-winning Tommy Higgs and Mike Dove of the Three Horseshoes, Emma Gibbon from the Plough in Prestbury, Justine Lorriman of the famous Royal Dyche in Burnley, Matt Todd of the Wonston Arms, and the excellent Steve Alton of the British Institute of Innkeeping—to go through the details of the challenges they are facing, so I welcome the chance to underline the Government’s recognition of the importance of hospitality businesses in all our communities to the economic, cultural and social life of our country.

In this debate we have heard many other examples of great hospitality businesses, notably in the excellent speeches of my hon. Friends the Members for Reading West and Mid Berkshire (Olivia Bailey), for Bournemouth East (Tom Hayes), for Welwyn Hatfield (Andrew Lewin), for Ealing Southall (Deirdre Costigan), for Gedling (Michael Payne), for Leeds North West (Katie White), for Hexham (Joe Morris), for Falkirk (Euan Stainbank), for Cumbernauld and Kirkintilloch (Katrina Murray), for Tipton and Wednesbury (Antonia Bance), for Stirling and Strathallan (Chris Kane), for Monmouthshire (Catherine Fookes), for Calder Valley (Josh Fenton-Glynn) and for Portsmouth North (Amanda Martin).

Hospitality is a sector that contributes well over £50 billion to our economy and employs millions of people across the UK. It is particularly important for young people, who need to gain essential skills and experience to pursue successful lives. It is also often an entry point for those who want a second chance in life, and I pay tribute to Greene King for working with 65 prisons across the UK to provide inmates with hospitality training. It aims to hire 400 prison leavers by the end of this year.

What all the contributions to this debate underline once again is that hospitality is truly the backbone of our high streets and the lifeblood of our communities. However, pubs, cafés, restaurants and hotels felt the full force of the headwinds unleashed by the economic incompetence of the Conservative party. We had 14 years of Britain’s hospitality entrepreneurs being let down. The Conservatives unleashed a cost of living crisis, and interest rates rose 14 times. We had double-digit inflation, with food prices driven higher by the disastrous Brexit deal that they signed. The Conservative party said that it was against red tape but made it ever harder for hospitality businesses to change and innovate. According to the British Beer and Pub Association, the last Government’s watch resulted in 10,000 fewer pubs. When both shadow Ministers held key roles in government, a total of 185,000 hospitality businesses closed their doors for good between 2017 and when they left office.

We are turning the page on that grim period with an industrial strategy to boost the whole economy by driving business investment, productivity and innovation across the economy. Businesses across all sectors have welcomed this approach. Frankly, they welcome the marked departure from the permanent chopping and changing of policy that marked the 14 years when the Conservatives were in power. We had austerity, the disastrous trade deal with Europe, and then the revolving door of Prime Ministers and Chancellors. We are doing things differently by setting out comprehensive, research-backed and business-informed strategies to help businesses plan not just for the next 10 months, but for the next 10 years and beyond. Focusing on our core industrial strategy sectors will benefit the rest of the economy, too—for example, the creative industries are a key sectors that will help drive benefits and opportunity for the hospitality sector.

It is a little rich for the Opposition to talk about omissions from the industrial strategy, when they gave up on having any kind of industrial strategy in their final years in office. All our work is complemented by our small business strategy: to back entrepreneurs, to invest in the high street, to improve access to finance, to open up overseas and domestic markets, and to build business capabilities. Inspired by the US’s Small Business Administration, we have launched our Business Growth Service, which will be the go-to place to get the advice and information that businesses and entrepreneurs need. We are determined to tackle the scandal of late payments, which the Conservative party never did.

On business rates, let us remember what the Conservatives promised six years ago. In their 2019 manifesto, they said they would begin a fundamental review of the business rates system, but they never did. They were due to reduce business rates relief to zero from April this year. We stopped that—we have kept the relief—and we will deliver on our manifesto commitment to create a fairer business rates system that protects the high street, supports investment and drives growth. We will deliver permanently lower multipliers for retail, hospitality and leisure businesses, and I certainly agree with my hon. Friend the Member for Cumbernauld and Kirkintilloch that it is staggering that the Scottish Government will not commit to do the same.

The Chancellor of the Exchequer had to take difficult decisions in the Budget last year to fix the £22 billion black hole in the public finances. The decisions she took were vital to help build the long-term stability that is essential for investment, creating jobs and, crucially, putting more money in people’s pockets. While I understand the sector’s concerns about the increase in national insurance contributions, we are protecting the smallest businesses by increasing the employment allowance to £10,500. Some 1 million employers, of which thousands are hospitality businesses, will pay no NICs at all, and more than half of employers will see no difference or will gain from this package.

We are committed to reducing regulatory burdens to bring down the cost of food, which is why we negotiated a sanitary and phytosanitary deal with the European Union. It is also why we launched the licensing taskforce, with proposals to rebalance the licensing system to better support business growth, cultural vibrancy and public safety. We will bring forward further work in that space shortly. We have also introduced the hospitality support scheme to co-fund projects in line with Hospitality Sector Council priorities, including by supporting initiatives such as Pub is The Hub to encourage local investment, particularly in rural communities. Indeed, the Conservative party axed all funding to support pubs, including support for Pub is The Hub.

Successful pubs, cafés and restaurants depend on people having the money in their pockets to go out and enjoy what are the best hospitality businesses in the world. Wages grew faster in the first 10 months of this Government than they did in the first 10 years of the Conservatives’ time in office. Disposable incomes are set to rise during this Parliament at twice the rate they did during the last Parliament. Business investment is up, almost 400,000 jobs were created in our first year in office, we have had five interest rates cuts and business confidence is rising.

The Conservatives gave up on pubs; they gave up on entrepreneurs; they gave up on cafés, restaurants and hotels; they gave up on small businesses; and they gave up on high streets. They never had a strategy for growth, they certainly did not have a strategy to back hospitality, and they certainly have not offered any new ideas today. We do have a strategy for growth, and we will continue to work with the hospitality industry to address the challenges it faces. I urge the House to reject the motion.

Question put.