Scottish Government: How much of a priority are our pubs?

Before it was a chance to get in a scrap at Asda over a 55 inch 4K Ultra HD Smart TV, Black Friday used to be what we’d call the busiest day of the year for pubs.

It was how the trade referred to the last Friday before Christmas when just about every office, every building site, every factory in the country would finish up for the holidays.

It’s the busiest night of the year. For most boozers, busier even than New Year's.

This year’s Black Friday could be the darkest yet. It comes just three days after Shona Robison sets out her tax and spending plans for the year ahead.

The hospitality industry is hoping she might follow Jeremy Hunt’s lead and extend business rates relief for hospitality firms.

In his Autumn Statement, the Chancellor confirmed that the 75% discount – introduced in the wake of the pandemic – would be extended for a further 12 months.

That discount means businesses in England and Wales can claim relief up to £110,000, saving the average pub £12,800 a year.

However, it’s the Scottish Government who has ultimate responsibility for setting business rates policy north of the border.

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In a joint submission to the government, the Scottish Beer & Pub Association (SBPA) and the Scottish Licensed Trade Association (SLTA) have warned that without a similar measure, the prospects for pubs and venues here are dire.

They know this because, while 100% relief was initially brought in for Scottish hospitality businesses by the then finance secretary Kate Forbes for the whole of the 2020/21 financial year, it dropped to 50% for the first three months of the 2022/23 fiscal year before ending completely.

Analysis by the two trade bodies shows that that has resulted in permanent closures in the sector accelerating at double the rate in Scotland (1.7%) than in England (0.75%).

And those closures are ramping up.

Analysis by two hospitality trading bodies show permanent closures in Scotland are accelerating at double the rate than England (Image: Newsquest)
In 2020, there were six pub closures in Scotland, in 2022 there were 56, and in the first three quarters of 2023, there have already been 76.

Many pubs are still paying off debt incurred during the pandemic, and dealing with eye-watering energy prices and the impact of inflation.

Next year, they’ll have to find extra cash to pay the minimum wage hike.

“The rates relief in England will help businesses there with this increased cost,” the two trade bodies say, “but unless the Scottish Government passes on the support, pubs and bars north of the border will be left to entirely fend for themselves and the rate of closures will only increase.”

The smoke signals coming from St Andrew’s House don’t bode well.

As my colleague Scott Wright revealed on Saturday when a constituent wrote to Lorna Slater asking her to back the cut, the minister told them: “The Scottish Greens cannot support a new relief from non-domestic rates for businesses in the hospitality sector.”

She even warned that funding any relief would compel the government to “either raise the rate of (non-domestic rates) on all other businesses, raise more tax revenue by other means i.e. raising income and/ or council tax, cut existing reliefs, or make very substantial cuts to public services like schools and hospitals.”

How important are the Scottish Greens to the budget?

Well, according to the Bute House Agreement, their MSPs will help the minority SNP get it through Holyrood if there is “consultation and collaboration” between the two parties on what will be included.

As long as this results in spending on the policies outlined in the co-operate agreement and the Greens having “influence on other budgetary matters”, the party’s MSPs will push the Yes button when the budget comes to a vote next year.

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Let’s not overstate the Green influence here. Shona Robison has already warned that this is going to be the toughest budget in the history of devolution.

She’s given no indication she would like to bring in the relief, even though she will receive consequentials from Jeremy Hunt’s decision to extend south of the border.

And there is no shortage of demands being made of the Deputy First Minister. 

The question is how much of a political priority are Scotland’s pubs?