The government is poised to announce a targeted financial support package for Britain's pubs within the coming days, Sky News understands, as the sector faces a perfect storm of soaring business rates and the end of pandemic-era relief.
Political Pressure Forces Government Hand
Speculation about imminent intervention intensified just hours after Prime Minister's Questions on Wednesday, where concerns over the hospitality industry were raised. Sky's deputy political editor, Sam Coates, reported that rumours of a forthcoming announcement specifically for pubs, but not hotels, began circulating in the industry.
He suggested the move could be driven by the fact that pubs are seen as "more politically sensitive" than other parts of the hospitality trade. The potential for a one-off grant is on the table, though critics argue this would be an expensive stopgap that fails to address the root of the problem.
Backbench Revolt and Sector Warnings
The expected announcement follows direct pressure from within the governing party. House of Commons leader Sir Alan Campbell addressed backbench anxieties, stating: "The prime minister has been absolutely clear on this, [we are] listening and that he's actively, we are actively looking at, further measures, to help pubs and the hospitality industry."
This intervention comes against a backdrop of severe warnings. Hospitality venues, including pubs and hotels, are staring down the barrel of business rate increases that could see their bills rise by more than 100%. The new system, announced by Chancellor Rachel Reeves in the November budget, replaces the COVID relief scheme with a new band for retail, hospitality, and leisure.
While rates are lower than pre-pandemic levels, the sector argues this is insufficient. They contend the tax—based on rateable property values—unfairly penalises businesses with physical premises like pubs, unlike online giants.
Broader Backlash and Cabinet Tensions
The political fallout is already tangible. Several pubs have barred Labour MPs in protest at the changes, symbolising a bitter grassroots backlash. Furthermore, Sky News has previously reported that a cabinet revolt is brewing over the issue.
Despite the expected relief for pubs, significant challenges remain. Sam Coates highlighted the ongoing crisis for hotels, which are amongst the worst affected and face the biggest rate hikes in three years' time. He noted the immense difficulty in changing the Treasury's position, stating that officials had recently sounded "pretty much wanted to stick and were being quite stubborn."
The government has reportedly warned businesses that protesting the changes could jeopardise their chances of receiving any concessions, indicating the high-stakes negotiations happening behind the scenes.
