Not even a week into his premiership, and we are starting to get a sense of how Andy Burnham intends to tackle some of the country’s biggest challenges – and what that could mean for food & drink businesses. The first sign came in his inaugural speech, when he promised to give households more “breathing space”. The second came in the policy announcements, most notably the decision to cut business rates by 20% for pubs, clubs and music venues – a move with clear implications for the food & drink industry and an early signal of where his priorities lie.
The policy will save the typical pub an estimated £1,100 a year and benefit almost 32,000 venues. And it won’t now come at the expense of warehouses, with a mooted levy dropped. Instead, there will be a review of reliefs for businesses deemed not to contribute to their communities – chiefly vape shops – while cracking down on online marketplace sellers dodging their tax obligations. Naming no names, of course.
Will that raise enough? The tax clampdown remains at consultation stage, while the proposal to review reliefs is, for now, little more than a skeleton plan. Burnham also need to find further funding, having previously signalled he wants to scrap business rates entirely for small independent shops and restaurants – a promise the Federation of Independent Retailers was quick to remind him of.
So while pubs have secured an early win, much of the food & drink industry is still waiting to see whether he is prepared to tackle the underlying issues facing the wider sector.
Rates are, of course, only part of that story. National Insurance contributions are squeezing margins across grocery, retail, hospitality and manufacturing alike. For many food businesses, those rising employment costs now constrain investment and growth as much as business rates themselves.
This is a good opening move from a PM who knows he needs some quick wins. But he has promised a 10-year plan for Britain. That needs to extend to the far more complex challenge of fixing business rates and employment costs for the businesses that keep Britain’s food & drink Economy running.
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