SIX out of 10 tourism and hospitality operators in Scotland have less than three months of cash reserves and nearly one-quarter have none, a key survey shows, with players flagging energy costs and the cost-of-living squeeze as standout challenges.
The Scottish Tourism Alliance (STA) said, “positively”, 69% of respondents made a profit in 2022 as it published its latest barometer . However, it noted 28% were still making less profit than in 2019.
There were calls for the UK Government to free up immigration to allow people to come and fill vacant jobs, with an observation that “Scotland is very different to the home counties”.
Energy costs were cited as a challenge by 93% of respondents, with the cost-of-living flagged by 84%.
Annual UK consumer prices index inflation was 10.1% in January, having hit a 41-year high of 11.1% in October. Energy costs for UK businesses and households have soared since last year.
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The survey found 96% of respondents are “not confident”, “pessimistic” or “extremely pessimistic” that the UK Government’s new energy bills discount scheme will protect the sector over the next 12 months from the effect of higher energy prices. And 28% were “extremely pessimistic” about energy bill protection beyond April.
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The Scottish Government’s short-term lets licensing scheme and planned deposit return scheme were flagged as challenges by 83% and 58% of respondents respectively.
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STA chief executive Marc Crothall said: “Everyone across the country is facing intense pressures from inflation and energy costs and business is no different. Our industry is experiencing the double whammy from inflation and the policy pain that is adding costs which could put many out of business altogether. This is entirely the wrong time for the Scottish Government to be piloting policies that will do limited good and risk maximum harm.”
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