Hospitality Sector

James Wild Excerpts

Wednesday 3rd September 2025 Commons Chamber

[James Wild (North West Norfolk) (Con)]

As we have heard, hospitality is a crucial part of our economy. Our pubs, restaurants, hotels and other businesses employ 3.5 million people—over 5,000 in my North West Norfolk constituency alone, contributing £136 million to my local economy—but this Government’s decisions have hammered the sector. As the owner of the Crown and Mitre pub in King’s Lynn, which I highly recommend, recently put it in the local Lynn News:

“How many rising costs can you face before collapsing face-first into the till?”

Will’s grim humour says it all. He says that costs are piling up faster than a

“bad souffle in an over-heated oven”.

But the reality is no laughing matter. When we were in Government, the Conservatives supported the sector. We boosted growth and helped it to recover from the difficult decisions that we had to make during covid. That record stands in sharp contrast to what we are seeing today. All Members will know from talking to hospitality businesses in their constituencies this summer just how worried they are about the increased costs.

When I was at the Rose and Crown in Harpley during the summer, talking to the team that reopened that pub and had pubs across Norfolk, I heard just how damaging the increase in the national insurance rate has been. The lowering of the threshold to £5,000 has also been a real challenge. That change alone has brought 750,000 workers in the sector into national insurance for the first time—and what has happened? Well, as UKHospitality’s TaxedOut campaign shows, Labour’s decisions have already cost nearly 90,000 jobs in the sector, particularly hitting younger people, part-time workers and those starting out in entry-level positions, which they can then grow into the career that the Minister said that he hoped more people would have an opportunity to do.

The jobs tax is costing the sector as a whole £3.4 billion a year. Little wonder that a third are now operating at a loss. Three quarters have had to put up their prices to cope with the increased costs that they are facing, and two thirds are reducing the hours of their existing staff, and are not taking on the people that they otherwise would have done. Little wonder, too, that UKHospitality has called the Government’s decisions a “hammer blow” for the sector.

But it is not just the jobs tax; the Government’s choice to almost halve hospitality and leisure business rates relief from 75% to 40% will hit a quarter of a million businesses. I was very surprised, as I am sure the sector would be, to hear the Minister boasting about this damaging decision, given that the average pub is paying £5,500 more and restaurants are paying £9,000 extra. How does he expect them to absorb those costs without the consequences for employment that we are seeing? Depressingly, there is even more to come. The Deputy Prime Minister’s Employment Rights Bill—or whoever picks it up after her—will add £5 billion a year to employer costs, making it less likely that firms will take on people.

Our hospitality firms are resilient, and they need to be with all they are having to weather. This Government are putting them under the cosh. With creativity, investment and the high-quality staff across the sector, hospitality firms can attract customers and support our local communities. I have seen many impressive hospitality businesses in my constituency, including ones that have newly reopened—the Ship in Brancaster, the Chequers in Thornham, the Pub in Clenchwarton, and new enterprises such as Nopa and VinedMe, which are also in Thornham—but the Government are making it far too hard for firms like those to thrive and grow. Members have the opportunity today to back our very sensible motion to back the sector, to think again about the doubling of business rates, and to amend the damaging Employment Rights Bill to protect seasonal and flexible work.

With borrowing costs at a 27-year high, hospitality businesses cannot afford for a Government to be making such damaging economic choices. Ahead of the Budget, the Chancellor and her team of tax raisers should listen to employers and take action to live within our means, otherwise more pubs, more venues and more jobs will be lost.