The Lowdown: General Election 2024

By James McAllister

- Last updated on GMT

Credit: Getty / smartboy10
Credit: Getty / smartboy10

Related tags General election Government Uk Hospitality

It’s less than two weeks to go until the country heads to the polls, but what, if anything, are the main political parties promising to help support the hospitality sector?

Has anyone finally committed to a VAT cut?
Actually yes. In its manifesto, the Green Party has proposed to ‘reduce VAT on hard-pressed areas such as hospitality and the arts and increasing it on financial services and private education’. It’s the only national party to make such a pledge (although the SNP in Scotland have made a similar promise for businesses north of the border). Unfortunately, given that the odds of a Green majority are currently 1000/1, according to SkyBet​, there’s little chance of it happening. But there are plenty of other ideas being presented by the country’s political leaders as they set out their vision for the future ahead of the 4 July election.

Like what?
Let’s start with business rates. Save for a cut to VAT, an overhaul of the business rates system is the main policy proposal to have been consistently called for by the industry at each economic event (be it the Budget or Autumn Statement) in recent years. If it gets into power, as current polls predict, Labour is promising to replace business rates with a new system it says will ‘raise the same revenue, but in a fairer way’, although details on how they will achieve this appear vague at present. In contrast to the current system, which Labour says ‘disincentivises investment, creates uncertainty and places an undue burden on our high streets’, its manifesto claims the new system will ‘level the playing field between the high street and online giants, better incentivise investment, tackle empty properties and support entrepreneurship’. Similarly, the Liberal Democrats also say they want to abolish business rates and plan to replace them with a Commercial Landowner Levy, which will ‘boost small businesses and empower them to create new local jobs’.

What about the Conservatives, are they offing a similar proposal?
Not exactly. The Conservatives have long spoken about making changes to the business rates system. In their 2019 manifesto the party promised to ‘cut the burden of tax on business by reducing business rates’ through a ‘fundamental review of the system’. Said review was published in 2021 and led to a series of tweaks to the system, including a one-year 50% relief for retail, hospitality and leisure sector and a one-year freeze of the multiplier, which undoubtedly contributed to a reduction in the burden placed on businesses by the system at the time, but stopped short of the more substantial, long-term change many in the industry have demanded. In its latest manifesto, the Conservatives say they will ‘continue to ease the burden of business rates for high street, leisure and hospitality businesses by increasing the multiplier on distribution warehouses that support online shopping over time’. It also reiterates its committed to a business rates support package worth £4.3bn over the next five years, which was announced by Chancellor Jeremy Hunt during his Autumn Statement last year.

How has the industry reacted to the plans?
Industry bodies have, of course, been passing comment on each of the party’s manifestos as they’ve been published. UKHospitality welcomed both Labour and the Conservative’s promises on business rates, with Labour also receiving support from the Campaign for Real Ale (CAMRA). Not everyone is impressed, though. John Webber, head of business rates at property agency Colliers, which has been a long-time campaigner for business rates reform, criticised both plans, saying the Conservative’s pledge ‘misses the point that the overall burden of business rates is simply too high for everyone’, and describing Labour’s vagueness at how it will deliver the reform promised as ‘frustrating’.

What else is being promised to support the industry?
Suffice to say, there isn’t much in any of the manifestos that directly references the hospitality sector, but then that’s hardly a surprise given the breadth of the social and economic challenges facing any incoming government. There are some intriguing morsels to be found, though. Should it be re-elected, the Conservative party has committed to launching a review of the nighttime economy in England that it says will ‘look at how to reverse the decline in pubs and clubs and how to make our towns and cities great places to go out’. In contrast, Labour has set out plans to introduce new right-to-buy powers for communities to buy and revamp local assets, such as pubs. The Liberal Democrats, meanwhile, have pledged to create a dedicated Minister of State for Tourism and Hospitality in a bid to ‘upgrade the status of tourism in government’, answering calls that were first petitioned for by the industry back in 2020.

What are we hearing from the regional parties?
In Wales, Plaid Cymru says it supports a reform of business rates and has pledged to amend the multiplier to ‘better support high street business, such as retail and hospitality’. The party has also said it would outlaw fire and re-hire tactics; abolish compulsory zero-hours contracts; and establish the ‘right to disconnect’, which is defined as ‘a right not to be routinely contacted about work outside normal working hours’. In Scotland, the SNP similarly wants to scrap zero hours contracts and ban fire and rehire practices, something that Labour also says it will do nationally as part of its New Deal for Working People.

Is immigration a big talking point in the election?
Of course. Reform UK leader Nigel Farage has said that ‘this should be the immigration election’. The party has pledged to ‘freeze non-essential immigration’ entirely if it were to win power, with the only exception being for ‘essential skills’, mainly around healthcare. The Conservatives want to introduce a ‘binding, legal cap on migration’ that would fall every year of the next Parliament. It would also raise the Skilled Worker threshold with inflation automatically. By contrast, Labour says it would ‘strengthen’ the Migration Advisory Committee, and establish a framework for joint working with skills bodies across the UK, the Industrial Strategy Council and the Department for Work and Pensions. The Liberal Democrats, meanwhile, say they would ditch the Conservatives’ ‘arbitrary salary threshold’ for work visa and replace it with a ‘more flexible’ merit-based system, with the relevant department working with employers in each sector to address specific needs as part of a long-term workforce strategy that also focuses on education and training to address skills gaps from within the UK.

You mentioned Reform. There’s been a lot of talk about them in recent weeks, so what are they offering?
There isn’t one direct mention of hospitality in Reform’s version of a manifesto, labelled a ‘contract’ by the party, despite Farage’s love of pubs. That said, there is a plan to abolish business rates for SMEs, which would be offset through an Online Delivery Tax at 4% for large, multinational enterprises. The policy that’s most likely to have caught the eye of the sector, however, is the suggestion of an Employer Immigration Tax, which would see the National Insurance rate paid by businesses raised from its current level of 13.8% to 20% for foreign workers. This is probably not ideal for the sector given that at least of quarter of its workforce hails from overseas.

Any other threats to hospitality businesses on the horizon?
It would be remiss of us to not mention former London mayor hopeful and self-proclaimed 'intergalactic space warrior' Count Binface. The independent candidate who is running to be an MP in the Richmond and Northallerton constituency​ has put together a manifesto that includes capping the price of croissants at £1.10, a move which could have serious ramifications for the booming patisserie sector, not least baker Philippe Conticini, whose giant croissants will currently set you back up to £35 each.

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