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Business Rates Relief cut ‘spells disaster’ for Welsh hospitality sector

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THE ANNOUNCEMENT was made last year, but this week the reality kicked in.

The Business Rates Relief has been cut in Wales has kicked in and the hoped-for u-turn has not materialised.

The substantial reduction in business rates relief for hospitality firms has stirred significant concern amongst business owners and industry representatives across Wales.

Effective from 1 April 2024, the relief has been cut from 75% to 40%, accompanied by a 5% rise in rates. This decision is part of a broader strategy to redistribute financial resources to support essential services, particularly the health service, amidst ongoing fiscal pressures.

Finance Minister Rebecca Evans has acknowledged the difficulty of these decisions, emphasising the government’s commitment to managing a tight budget in challenging times. However, the reduction in support has sparked fears of financial strain and potential closures within the hospitality sector.

Industry Response

The announcement has been met with dismay by industry leaders, who warn of the competitive disadvantage Welsh businesses will now face. David Chapman, Executive Director of UKHospitality Cymru, highlighted the stark contrast with England, where businesses continue to benefit from the 75% relief. “This disparity will undoubtedly place Welsh businesses at a competitive disadvantage, particularly small businesses that will see their counterparts across the border enjoying frozen rates,” Chapman said.

A typical pub or restaurant in Wales is now expected to pay £6,400 more than one in England, a disparity that could have severe implications for the viability of many establishments.

Budget Cuts and Tourism

The reduction in business rates relief is not the only financial challenge facing the Welsh hospitality and tourism sectors. The Welsh Government’s budget for 2024/25 also includes a £16m cut in funding for tourism, culture, and sport. Given the strategic importance of tourism to Wales’ economy and cultural identity, this decision has been met with criticism. The sector, already facing intense economic challenges, views the cut as a significant setback that could undermine long-term confidence and investment.

Political and Community Reaction

Stephen Crabb MP, pictured here with restaurant owner Dan Mills, has been vocal in his efforts to highlight the challenges facing the hospitality sector, especially in regions like Pembrokeshire that rely heavily on tourism. Crabb has been engaging with local business owners, bringing attention to the sector’s struggles at both the local and national levels. “The upcoming season should be a time of optimism, but the reality is far different due to these financial challenges,” Crabb stated, emphasising the need for greater support to ensure the sector’s competitiveness and sustainability.

The Welsh Conservatives have strongly criticised the Welsh Government’s decision, with Andrew RT Davies MS, the party’s leader, and Tom Giffard MS, Shadow Minister for Tourism, both calling for a reevaluation of the relief cut. They argue that the reduction could be catastrophic for businesses already contending with the post-pandemic economic landscape, urging the government to maintain competitive rates relief.

Calls for Reconsideration

Amid growing concerns, FOR Cardiff, representing businesses within the city, has issued an open letter to the Minister for Finance, urging the Welsh Government to reconsider its approach to business rates relief. The organisation highlights the critical role of high street businesses in the everyday economy and warns of the potential for widespread closures without adequate support. Carolyn Brownell, FOR Cardiff’s Executive Director, called for a more gradual approach to tapering relief, suggesting that some of the government’s capital funds could be redirected to provide targeted support where it’s most needed.

Looking Forward

As the hospitality sector braces for the impact of these financial changes, the debate continues over the best path forward. Industry leaders, political figures, and community representatives are calling for a balanced approach that supports businesses through these challenging times while addressing the fiscal needs of the country.

The coming months will be crucial in determining the long-term effects of these decisions on Wales’ hospitality sector and broader economy.

How many pubs and restaurants will survive?

Business

Women make better homeworkers than men, according to new survey

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A GROUNDBREAKING survey conducted by the team behind the British Business Excellence Awards (www.britishbusinessexcellenceawards.co.uk) have uncovered a significant trend in the remote work landscape: women are leading the charge as successful remote workers, surpassing men in both productivity and overall satisfaction with remote work arrangements.

The survey, encompassing more than 2,300 UK adults in full-time employment (a 50/50 split of men and women), revealed a striking trend: over two thirds of employees (69%) perceive female remote workers as more productive than their male counterparts. Contrary to traditional assumptions, women are not only adapting to remote work, but thriving in it.

Additionally, over three-quarters of women (76%) reported increased productivity since transitioning to remote work, compared to 54% of men. This shift in productivity is closely tied to work-life balance, with 72% of women indicating an improved balance since working remotely, compared to 58% of men.

Female remote workers also stood out in terms of approachability and support, with a staggering three-quarters of respondents (75%) perceiving female colleagues as more approachable in the virtual workspace. This accessibility and support contribute to a more cohesive and connected remote work environment.

In a reflection of the evolving priorities in the business world, over half of men (54%) and three-fifths of women (61%) believe that female remote workers are more progressive when it comes to sustainability and environmental initiatives. Women in remote roles were perceived as having a stronger focus on implementing sustainable practices and promoting eco-consciousness in their virtual teams.

Conversely, the survey highlighted a perception that male remote workers are more comfortable with embracing technology and artificial intelligence (AI), with 78% of men and 61% of women expressing this view. This suggests that male remote workers are seen as driving digital transformation and leveraging tech tools more readily in the virtual workspace.

Sarah Austin, Director of the Lloyds Bank British Business Excellence Awards, commented:

“These findings challenge traditional norms and underline the importance of fostering an inclusive work environment where all employees, especially women, can thrive. The data clearly shows that women bring unique strengths to remote work, contributing to higher productivity, improved work-life balance, and a focus on sustainability.

“The survey underscores the significant advantages of supporting and promoting women in remote work settings. As businesses continue to navigate the remote work landscape, understanding and leveraging the strengths of female remote workers can lead to enhanced productivity, employee satisfaction, and overall success.”

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Business

Lidl GB eyes Pembroke Dock for new larger supermarket

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LIDL GB has disclosed a coveted list of locations for new stores across Wales, prominently featuring Pembroke Dock among other key Welsh towns such as Newport, Cardiff, and Brecon. This announcement is part of the retailer’s broader strategy to inaugurate hundreds of new outlets throughout Great Britain, a plan that promises to generate thousands of jobs and revitalize local economies.

As Lidl marks its 30th anniversary since launching its first store, the company not only celebrates a historic market share peak of 8% but also reflects on a year of substantial infrastructural investments. These initiatives include the unveiling of the largest global distribution centre in Luton and the expansion of the Welsh distribution hub in Bridgend, alongside enhancements at the Belvedere warehouse which is set to double in capacity upon completion.

Richard Taylor, Lidl GB’s Chief Development Officer, elaborated on the company’s ambitious growth trajectory. “With significant investments fortifying our operations and a series of strategic store enhancements, our market position has never been stronger,” he stated. Taylor highlighted the brand’s ongoing status as the fastest-growing bricks and mortar supermarket for seven consecutive months, underscoring its relentless pursuit of operational excellence and commitment to affordability.

The proposed expansion into Pembroke Dock is poised to bring high-quality, affordable groceries closer to more households, aligning with Lidl’s mission to make good food accessible to all. The move is expected to attract a larger customer base, boosting Lidl’s market presence even further.

In pursuit of suitable sites, Lidl is offering incentives such as a finder’s fee for identifying viable locations, which includes 1.5% of the total freehold purchase price or 10% of the first year’s rent for leaseholds. Ideal sites would be prominent, easily accessible, and have substantial traffic or pedestrian flow, accommodating stores between 18,000 and 26,500 square feet with ample parking.

The strategic choice of Pembroke Dock reflects Lidl’s investment in regions with growth potential, ensuring that the benefits of its expansion are felt widely across Wales and beyond. As the retailer continues to explore innovative expansion avenues, the future looks promising for both Lidl and the communities it serves.

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Business

Bluestone National Park Resort payments to county to end

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A CALL to end a 20-year legal agreement for financial contributions associated with the creation of Pembrokeshire’s Bluestone National Park Resort has been backed by both the county council and the national park.

In related submitted applications to both Pembrokeshire Coast National Park and Pembrokeshire County Council, Bluestone Resorts Ltd asked to end a 2004 Section 106 legal agreement, used to pay towards various projects including enhancements to works including footpaths and bridges.

Bluestone has paid nearly £320,000 to date, and offered two further one-off payments to complete the agreement, reports for the two authorities have said.

Works have been predominantly in the area surrounding Bluestone, but include projects as far afield as Nevern, Solva, and Haverfordwest.

A supporting statement says that, since the agreement was made back in 2004, Bluestone has paid nearly £280,000, with the offer of a final fee of £113,000 being paid, spread over 2023, 2024, and 2025.

A report by national park officers, ahead of the Pembrokeshire Coast National Park Development Management Committee meeting of April 24, where it was recommended for approval, said: “Having considered the information submitted, officers consider that provided the two final payments [the 2023 having been made] are received the legal agreement has served its purpose and can be discharged.

“In order to ensure the two final payments are made, a modification to the Section 106 legal agreement is supported.  This decision is supported by Pembrokeshire County Council, who have received a concurrent application which is also recommended by officers for modification.”

The report said the £280,000 figure presented by Bluestone actually amounted to £318,703.87, taking into account a 2023 payment of £38,891.73.

It concluded: “The authority is satisfied that subject to two further payments of £38,000 to be made in August 2024 and August 2025, the obligation no longer serves a planning purpose and can be discharged and as such the obligation should be modified accordingly.”

At the April 23 meeting of the county council’s planning committee, members backed the application by 11 votes to two, following a recommendation for approval by Cllr Brian Hall.

The following day, the related application came before national park planners, with three members leaving the meeting as they had declared related interests in the item.

Cllr Rhys Jordan, who had also been present at the previous day’s meeting, moved approval: “The economic benefit of this facility is huge to Pembrokeshire; whilst these contributions may come to an end, the contribution to the county is huge.

“Bluestone has been at the forefront of all things hospitality, and everything they do is with the environment in mind.”

That application was unanimously approved by members present.

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