Covid-19: Hospitality Industry

Part of the debate – in the House of Commons at 5:04 pm on 24th March 2021.

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Photo of Ben Lake Ben Lake Shadow PC Spokesperson (Treasury), Shadow PC Spokesperson (Environment, Food and Rural Affairs), Shadow PC Spokesperson (Education), Shadow PC Spokesperson (Digital, Culture, Media & Sport), Shadow PC Spokesperson (Health and Social Care), Shadow PC Spokesperson (Housing, Communities & Local Government), Shadow PC Spokesperson (The Constitution and Welsh Affairs) 5:04 pm, 24th March 2021

Like others, I congratulate Selaine Saxby on securing this very important debate.

I agree with a lot of the points that have been made by hon. Members who have spoken, but would like to add a few more. Despite the unprecedented support from every level of government, including the Welsh Government and local authorities, yesterday’s Office for National Statistics data offered quite a sobering reminder of the devastating impact that the pandemic continues to have on businesses and employment in Wales. A year into lockdown, the Welsh unemployment rate has risen by 1.1%, while Wales’s perennially high economic inactivity rate has reached 24.4%, meaning that a quarter of the Welsh workforce is either not in employment or not seeking employment. I hope this debate will be a helpful reminder to Government of the importance of the hospitality sector both as an opportunity for jobs and for the way in which it helps particular regions, particularly coastal and rural areas, where other opportunities are sadly fewer and further between.

Before the pandemic, the hospitality sector contributed £59.3 billion to the UK economy and employed over 2.3 million workers across the UK. That in itself speaks for the significant contribution that the sector makes, but it was also an important gateway into the labour market for younger workers, with approximately one in 14 young adults employed in the pub and brewing sector alone. This sector is particularly important in rural areas such as my constituency of Ceredigion, where approximately 4,500 people, or 17% of the local workforce, are employed directly by the hospitality sector. It is worth noting that the sector, through local procurement and purchases from wholesalers such as Harlech Foodservice and Castell Howell, plays an important role in supporting the wider economy and rural incomes. Businesses in the hospitality supply chain, from food wholesalers and breweries to culinary suppliers and contract caterers, have not received as much attention, but they are essential for the success of the sector and should be supported by the Government.

While this month’s Budget contained several welcome measures for hospitality, I again urge the Chancellor to extend the 5% rate of VAT to the full financial year rather than six months and to consider proposals for a specific draught-beer duty to encourage on-premises consumption—a point that has been made very effectively by other hon. Members. Such measures would help to ensure that hospitality businesses can make the most of the upcoming summer season. Hopefully we can all look forward to a summer of unlocking. With potentially several months of restrictions, in various forms, to come, I urge the Government to be attentive to the needs of hospitality as a pivotal employer and significant economic multiplier. Particularly for those people in areas hardest hit by the pandemic, its survival is essential for post-pandemic recovery.