Scottish Government warned 'five weeks to save hospitality industry'

Stephen Montgomery, director of the Scottish Hospitality Group, said: “The hospitality industry faces a crisis, and we can’t go on like this.

“Without government support, there will be higher prices for consumers, a loss of jobs, and many of our best-loved hospitality businesses closing their doors forever.

“We need to make sure that we get our point across in the next five weeks before the budget is released and back our hospitality industry to survive and thrive.”

Pictured: Stephen Montgomery, Scottish Hospitality Group (Image: Supplied)

Stephen Montgomery (pictured)

The urgent need for support is said to have been caused by a ‘double economic punch’ as a result of the Covid-19 pandemic and rising costs of inflation and energy prices.

Mr Montgomery, the owner of a 48-cover restaurant in Dumfries and Galloway, has first-hand experience of mounting pressures faced by the industry as well as the customers it relies on.

He said: “Many businesses have come out of the pandemic with financial debt.

“And now we are in a cost-of-living crisis that is causing suffering for both the industry and consumers.

“In some cases, the turnover is up, but the profit is down meaning that to break even you have to keep increasing prices.

“The consumer cannot continue to pay more for the luxury of eating out when they are also struggling to manage the cost of maintaining their homes.”

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In an effort to secure a lifeline for the sector, the new campaign calls for an emergency 75% business rates relief to match the support that hospitality businesses in England and Wales have received over the last year.

Furthermore, it asks for the creation of a new hospitality category for business rates and a new partnership with the Scottish government to allow for the development and growth of an industry which forms an essential part of the country’s cultural identity. 

Mr Montgomery continued: “The campaign has not been launched because business owners are looking to make a huge profit and drive around in fancy cars.

“We’ve seen over 15000 hospitality businesses across the UK close since 2020 and that number is only going to continue to grow.

“If the local pub in a village with maybe 3000 people in it shuts because they can’t afford to keep going, it’s going to have a huge impact.

“These restaurants, bars, cafes and hotels are the places where a community creates its memories and all of them have a family story behind them.

“Once they’re gone, they will never reopen.”     

While the Scottish Hospitality Group has clearly outlined the severity of the situation, Mr Montgomery is hopeful that the new campaign will provide a ‘shot of adrenaline’ for the businesses large and small across the country which will be fighting to survive the next year.

He said: “We’re asking both members of the public and politicians to get behind this.

“A new, fairer deal on business rates would be one step the Government can take in the Budget to give our hospitality industry a fighting chance.

“A freeze in rates or the status quo won’t be enough. We need both emergency support and long-term reform.

“This is an SOS – we need help to make sure Scottish hospitality can survive”. 

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Highlighting measures brought in to support businesses in recent years, a Scottish Government spokesperson said: “The hospitality sector is vital to Scotland’s economy.

"We are acutely aware of the enormous pressures facing businesses across the country, including inflation, energy price rises, and higher costs of borrowing – which is why we are taking decisive steps to offer support during this crisis, with limited powers and working within the most challenging budget since devolution.

“The Scottish Budget 2023-24 ensures the lowest poundage in the UK for the fifth year in a row and supports a package of reliefs worth an estimated £749 million, including the Small Business Bonus Scheme which is estimated to take over 100,000 properties out of rates altogether. Around half of the properties in the retail, hospitality and leisure sectors are eligible for 100% SBBS relief this financial year. Decisions on non-domestic rates for 2024-25 will be made as part of next month’s Budget.

“The Scottish Government has also established an Industry Leadership Group with the tourism and hospitality sector to understand its unique needs going forward. Through the New Deal for Business Group, we will continue to ensure businesses are informed early of decisions affecting them, giving them as much time as possible to provide input, to react and to prepare for any changes.”