A Disappointment in Political Promises
Sacha Lord, a former advisor to the mayor of Manchester, Andy Burnham, has expressed deep regret over a statement he made about the Labour Party. He now wishes he had never described Labour as “the party of business and growth.” This sentiment stems from his belief that the party’s actions have not aligned with its promises, particularly after Rachel Reeves’ speech during the Labour Party’s manifesto launch.
On June 13th of last year, Sacha was present at the NOMA building in Manchester for the Labour Party's manifesto launch. The event was filled with energy, excitement, and hope. The full shadow cabinet, every Labour Mayor, and numerous journalists were in attendance. Rachel Reeves delivered a powerful message, promising a “pro-growth, pro-business Labour government.” For a sector like hospitality, which had endured years of economic stagnation, this felt like a beacon of hope.
Sacha left the event feeling invigorated and later tweeted that this was the “party of business and growth.” Millions of people agreed, leading to a significant shift in public opinion and voting behavior. However, what followed was a stark contrast to the initial optimism. Reeves’ actions in government did not match her words, resulting in a loss of trust in politics, even in the wake of events like Partygate.
A Call for Change in Politics
The current political landscape is marked by a lack of trust, and it's evident that the approach needs to change. There should be less tribalism and more focus on the well-being of communities rather than political agendas. In Greater Manchester, leaders from different parties have managed to collaborate effectively, leading to better economic performance compared to other city regions in the UK.
The recent Budget has been met with skepticism. It feels more like a campaign to protect Cabinet jobs rather than a genuine plan to address the country's challenges. What is desperately needed are policies that support enterprise, recognize the importance of economic growth, and back the sectors that define the UK.
The Hospitality Sector's Struggles
Hospitality is the fifth largest sector in the UK and the third largest employer. Since the last disastrous Budget, over 110,000 jobs have been lost, many of which were taken from young people. Pubs are now selling pints at an all-time high, averaging £6.50 in Manchester and even £8 in London. However, after accounting for costs, taxes, and overheads, the average profit on a pint is just 12p. The alcohol duty on a pint in the UK is 20 times that of a pint in Germany, leading to the loss of a pub a day.
The recent announcement that pubs can stay open longer highlights how out of touch the government is with the sector. Pubs simply cannot afford to extend their hours without additional support, especially after the damaging hike in National Insurance. It seems that the government is not engaging with the right stakeholders, and this is not working.
Recommendations for the Government
Sacha suggests that the government should officially recognize the Institute of Hospitality by granting them Chartered Status and appoint a Hospitality Minister with industry experience. If the Chancellor had worked closely with the sector, she would have introduced a sector-specific VAT rate for hospitality, similar to most European countries. Reversing the National Insurance increase and reforming Business Rates are also essential steps.
Business Rates reform is already announced, but the parameters remain unclear. While it is hoped that this will lower bills for small venues, there is concern that larger venues, such as nightclubs, may be penalized. The hospitality sector is currently experiencing a wave of demoralization, with many operators facing financial and mental health crises.
Looking Ahead
With the Budget out of the way, there is hope that the constant leaks will cease, allowing for more investment. Sacha will be watching closely, hoping that politicians stick to their promises. No more tax rises, and no need to come back for more. However, he is not holding his breath.
Sacha Lord is the founder of The Warehouse Project/Parklife, a former night time economy adviser to the Mayor of Manchester, chair of NTIA, and author of Tales From the Dancefloor.
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