HOSPITALITY campaigners have declared outlets are closing permanently in Scotland at twice the rate as being observed in the rest of the UK, as calls were stepped up for support for the industry at the Scottish Budget this month.

Industry bodies the Scottish Beer & Pub Association and the Scottish Licensed Trade Association have joined forces today to urge ministers to provide the 75% relief from business rates (up to a maximum of £110,000 per business) which was granted to the hospitality, retail, and leisure sectors in England and Wales for a further year at the Autumn Statement.

The groups say that the decision by the Scottish Government to not provide the same level of relief in the current financial year has been “devastating”. They claim it has resulted in outlets closing their doors permanently in Scotland at double the rate compared with the remainder of the UK, with 1.7% of pubs north of the Border having shuttered this year compared with 0.75% down south.

Figures disclosed by the organisations suggest 76 pubs closed for good in the first three quarters of this year, compared with 56 for the whole of 2022.

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The SBPA and SLTA argue that Scottish ministers did not pass on funding for the measure that was provided by the UK Government through Barnett consequentials last year, though the Scottish Government has said its package of business rates relief is worth an estimated £749 million in the 2023/24 financial year. It says its small business bonus scheme is estimated to have taken more than 100,000 properties out of the scope of business rates altogether.

The Scottish Government will announce its Budget for 2024/25 on December 19.

In a joint-statement, the SBPA and SLTA said: “The failure to pass on rates relief last year was a devastating blow for Scotland’s pubs and bars and has resulted in a record number of permanent closures. Already in 2023, with a quarter still to go, permanent closures are more than one-third higher than the whole of last year and double the closure rates across the remainder of the UK.

“Many businesses are still saddled with debt incurred during the pandemic and have been unable to recover with the increased financial pressures in the aftermath, including sky-high energy prices, inflationary pressures and impacts to supply chains.

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“The next financial year will also see increased costs in the form of wages, with increases to minimum wages, which will need to be paid for directly by businesses. The rates relief in England will help businesses there with this increased cost, 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 Scottish Government must ensure that the rates relief is passed on in full or it will cement further closures in the sector, directly resulting in job losses and blows for communities across the country.”

In addition to its call for rates relief, the industry bodies are campaigning for the introduction of a permanent business rates multiplier of 35p for hospitality to support pubs, encourage investment, revitalise high streets and rebalance the business rates burden. The industry has long argued that it pays a disproportionately high level of business rates, compared with other sectors, because of the method used by assessors to calculate bills.

The two organisation have also urged ministers to continue to freeze the business rate poundage at the 2022 level.

However, their hopes may appear forlorn after The Herald revealed on Saturday that the Scottish Greens, junior partner in a power-sharing agreement with the SNP, signalled that it could not support further relief from business rates. In a letter from Lorna Slater, minister for green skills, circular economy, and biodiversity, to a constituent, the Scottish Greens MSP for Lothian (Region) said he party “cannot support a new relief from non-domestic rates for businesses in the hospitality sector”.

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Ms Slater noted: “There is already a broad spectrum of reliefs from NDR on offer, ranging from the small business bonus scheme to hardship relief, business growth accelerator relief, and rural rate relief.

“All of this carries a significant cost to the Scottish Government and therefore to taxpayers. The small business bonus scheme in particular has no equivalent elsewhere in the UK and a large number of hospitality businesses will already benefit from it. SBBS costs the Scottish Government around £300 million a year.”

Ms Slater went on: “Introducing a new form of relief would compel us to either raise the rate of NDR 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.”