Hospitality leaders have said firms "urgently need meaningful intervention" as government energy support is set to be cut.

Industry representatives said they had "serious concerns" and have called on the Scottish Government to do more to help bars, clubs, restaurants and hotels after the UK Government announced plans to reduce energy cost backing.

Colin Wilkinson, Scottish Licensed Trade Association managing director, said the reduced package of £5.5 billion comes as businesses are still struggling to recover from the pandemic.

He said: “Many businesses in the hospitality sector in Scotland have had a bitterly disappointing December – normally one of the year’s key trading periods for the sector – as a direct result of the economic crisis, train strikes, poor late-night public transport and lack of taxi provision in some towns and cities.

"We’re into the second week of January and these challenges remain."

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He said: "So, to hear that the current energy scheme is to be replaced with one that offers a discount on wholesale prices rather than a fixed cap price means that businesses will receive a vastly reduced level of support – understandably, we have very serious concerns about the impact this will have on the hospitality sector.”

The Scottish Hospitality Group said that: "Hospitality in Scotland [is] now hanging on a cliff edge.

"No rates relief in Scotland, a cut in energy support by 70 per cent, and DRS [deposit return scheme] costs.

"It is essential the Scottish Government steps in now to help save the sector before we see a tsunami of business failures."

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It comes as The Herald revealed that Scottish retailers have called for a level playing field on business rates with England after it emerged thousands of firms in Scotland will collectively pay nearly £60 million more on the property tax than their counterparts down south in the next financial year.

Mr Wilkinson added: “Obviously we are grateful for any government support but this new energy bills discount scheme does not, in our view, offer much hope for vulnerable sectors like hospitality when you consider that energy costs now account for around 8-10% of turnover for an average pub or bar.

"Energy is the second-highest cost for hospitality venues."

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He said the package is "not insignificant, but when you drill down into the detail, small businesses in particular will not be much better off".

“James Cartlidge, the Exchequer Secretary to the Treasury, said that discount would be the equivalent to a £2,300 saving for a pub and of course every little bit helps.

"But it’s not nearly enough.

“We said before Christmas that we know of many businesses set to close permanently amid the cost-of-living crisis and other ongoing pressures and there is also that other elephant in the room – the fact that we urgently need meaningful intervention on business rates.”