Commons Sense

House of Commons · Westminster Hall

Hospitality Sector: Eastleigh

04 December 2024 · 3 other contributors · 3,398 words

Opened by Liz Jarvis Lib Dem Eastleigh

Responding minister: Gareth Thomas

EconomyEmploymentBusiness & Trade

Summarised by AI from the official record, so it can contain mistakes.

Read the full transcript on Parliament.uk

At a glance

Liz Jarvis raised concerns about hospitality sector: eastleigh in Westminster Hall. A government minister responded.

Key points

  • Hospitality businesses in Eastleigh face challenges due to 3,000 per week heating expenses and rising costs.
  • The sector employs 1,805 people and contributes 114 million annually to Eastleigh's economy.
  • The government is urged to support energy cost management and reverse national insurance contribution increases.

Key requests to Government

The Government must provide specific steps to support energy cost management and debt recovery for hospitality businesses, reverse employer national insurance contribution increases, and reform business rates to encourage investment in buildings and infrastructure.

How the debate unfolded

MPs spoke in turn to share their views and ask questions. Here's what each person said.

Opened the debate

Liz Jarvis Lib Dem Eastleigh

Hospitality businesses in Eastleigh are facing significant challenges due to rising costs, including £3,000 per week heating expenses for Lorraine's pub. The sector employs 1,805 people and generates £114 million annually but is under pressure from increased employer national insurance contributions and reduced business rates relief, leading to unsustainable costs for businesses operating on razor-thin margins. With 2,704 hospitality businesses going into insolvency last year, the situation is critical.

Other contributors (3)
  • Angus MacDonald Lib Dem Inverness, Skye and West Ross-shire

    He asks the Minister about the impact of national insurance changes on Scotland's hospitality industry, noting that Scotland lacks business rates relief and believes these changes will severely harm the sector.

  • Jim Shannon DUP Strangford

    He commends Liz Jarvis for securing the debate and shares her concern over national insurance contributions, which are putting pressure on hospitality businesses. He warns that without government relief, many cafés and restaurants could close in the coming year.

  • Tom Gordon Lib Dem Harrogate and Knaresborough

    He thanks Liz Jarvis for bringing forward the debate and highlights the struggles of high streets in Harrogate and Knaresborough, arguing that proper reform of business rates is necessary to support local businesses.

Government Response

Gareth Thomas

I appreciate the opportunity to serve under your chairmanship and congratulate the hon. Member for Eastleigh on securing this debate, highlighting Small Business Saturday's importance. The hospitality sector employs around 3.5 million people and generates £140 billion in economic activity annually, contributing significantly to local economies and social objectives. Economic stability is crucial; however, we inherited a broken economy when coming into power. The Chancellor made necessary budget decisions to stabilize the economy, including doubling the national insurance contribution employment allowance from £5,000 to £10,500, benefiting about 1 million small businesses. We extended retail, hospitality and leisure relief at 40% and froze the business rates multiplier for small businesses at 49.9p. The Government also aims to introduce permanently lower multipliers for these properties from 2026-27. Additionally, over £1 billion has been provided in 2024-25 and 2025-26 through the British Business Bank to improve access to finance for small businesses. We have introduced high street rental auctions policy, allowing local councils to require landlords to open up closed facilities so that hospitality or other businesses can take advantage of those spaces. Furthermore, we published an Employment Rights Bill in October and will consult to ensure a balance between business needs and fairness for workers. Skills England has been established to enhance opportunities for people in rural areas, transforming the apprenticeship levy into a more flexible growth and skills levy. The Government is also increasing police officers on our streets and in town centres to address antisocial behaviour and crime issues faced by hospitality businesses.

▸ Assessment & feedback
Summary accuracy