'Entry Denied!': The Government's Dispute with Pubs Signals a Upcoming Year Challenge.

Government ministers heading back to their constituencies this end of the week might feel a sense of relief as a turbulent political term wraps up. However, for those hoping to stop by their neighborhood bar for a restorative drink, goodwill could be in short supply. In fact, some may discover they are barred from entry.

Over the past few weeks, establishments nationwide have been displaying signs that proclaim "MPs Barred" in demonstration to adjustments in business rates announced by the Finance Minister, Rachel Reeves, in her latest budget.

This campaign means one fewer retreat for many elected officials seeking solace from the bruising reality of their party's unpopularity. MPs now describe commonplace animosity in everyday places after a challenging first 18 months that has seen the party's ratings plummet from around 34% to roughly under a fifth.

"It is difficult being the representative of the area you have always lived in," commented one. "Our neighborhood bar is where we used to go with the kids and just be a normal family. But the last few times we've just ended up being shouted at by other drinkers. Now I'm not even sure we'll be able to be served."

This sense of dismay is visible in a social media post by Tom Hayes, the Labour MP for Bournemouth East, lamenting being banned from one of his regular haunts, the Larderhouse.

"It's the Christmas season," he noted. "But the Larderhouse and other businesses with a 'No Labour MPs' sign in the window, they are damaging the community spirit that business owners have helped to nourish." He went on, "We need to remove politics off the town centre full stop, but especially at Christmas."

A Cornerstone in the National Identity

After a tough times marked by high costs, the COVID-19 crisis, and evolving social trends, publicans were anticipating the chancellor's statement might bring some relief—particularly through a long-promised reform of the commercial tax system.

However the chancellor poured cold water on those expectations, keeping the system unreformed and choosing instead to reduce headline rates and allocate £4.3bn over three years in financial support for the retail and hospitality sectors.

While perhaps a supportive move, the impact of that support package has been overshadowed by the effect of a three-yearly property revaluation, which has caused the valuation of hospitality venues to increase sharply from their Covid-affected lows.

Beginning in next April, business taxes are set to jump by more than double for the typical hotel and over three-quarters for a public house, versus just 4% for large supermarkets and 7% for logistics centres. Whitbread, which operates pubs, restaurants and the Premier Inn hotel chain, estimates it will face an extra tax bill of between £40m and £50m as a result.

Joe Butler, the landlord at the Tollemache Arms in Northamptonshire, said: "Virtually instantly, the valuation of our business has doubled. That's going to be a massive rise for us."

This burden on publicans is inevitably felt in the price of a customer's pint.

"A pint of beer is now unaffordable. When we first started here 10 years ago, we charged £3.40 a pint. We're now nearly £7 a pint," Butler added.

At the same time, pandemic-related tax reliefs are being phased out, while hospitality operators are still absorbing increases in national insurance and the minimum wage from the previous budget.

"To create the least helpful budget for the hospitality sector and its customers, you would have come close to what we saw," stated Ash Corbett-Collins, the chair of Camra, the consumer organisation.

Many within the Labour party believe this is a confrontation they should not have picked, not least because of the central place the local pub holds in society.

Richard Quigley, the Labour MP for the Isle of Wight West, who also operates a fish and chip shop on the island, said: "We pledged for two years to pubs and hospitality businesses that we are going to provide support but then they get affected by this new assessment. We cannot allow taxes being reduced for big corporations but up for independent businesses."

Some point out that Keir Starmer himself has long been a frequent patron at his local, the Pineapple in north London, and often references their value to neighborhoods. "There is little we prefer than going to the pub for a drink, myself included," the prime minister said in February.

Yet pollsters liken picking a fight with pub owners to challenging NHS workers in terms of public perception.

Joe Twyman, director of the polling firm Deltapoll, noted: "From soap operas to real life, pubs have a special place in the national consciousness.

"For many people the local pub is regarded as an key pillar of the community, even if a significant number of those same people will infrequently drink there.

"The political risk with making an enemy of pubs is that your critics will quickly accuse you of undermining the core of this nation and its traditions, notably in the countryside. And they will be able to produce many heartfelt examples to drive the message home."

'A Matter of Principle'

One such instance is Andy Lennox, the landlord at the Old Thatch pub in Wimborne, Dorset, and the coordinator of the "MPs Barred" campaign. Lennox says he has provided notices to nearly 1,000 establishments and is dispatching 100 more every day.

His action has received support from a number of high-profile figures, including broadcaster Jeremy Clarkson, who owns a pub called the Farmer's Dog, and pop star Rick Astley, who has a stake in a brewpub in north London—although the latter has said he will not actually ban Labour MPs.

"We have long sought help for a years," explained Lennox, who is demanding a short-term VAT reduction. "The Treasury is spinning this as a relief package but that's not what people are experiencing, and that is the thing that has frustrated so many people."

Several within the sector believe a protest targeting individual Labour MPs is may be counterproductive. "I'm not sure it's a good idea to ban the very individuals we should be trying to persuade and influence," argued Corbett-Collins.

When questioned this week, the Exchequer highlighted the package being offered to hospitality. "We are supporting the hospitality industry with the budget's £4.3bn support package. This is in addition to our work to simplify licensing, keeping our reduction to alcohol duty on beer from the tap, and limiting corporation tax," a representative said.

The business owners, however, are in little mood to yield, even if losing MPs

Brian Munoz
Brian Munoz

A seasoned real estate analyst with over a decade of experience in property markets and home investment strategies.