Lord, who is also managing director of Parklife festival and The Warehouse Project music events, told The Morning Advertiser he believes the glut of closures in the trade currently happening are from where operators have decided to hand the keys of their sites back to pubcos or owners after a bumper Christmas.
Lord said: “In December, an operator can take up to one third of their annual turnover and I know a lot of people were trading through December knowing that Q1 of 2024 was going to be extremely hard.
“And I think people thought the decision at the beginning of December to hand the keys back in January, I really do.
“Everything at the moment: utility bills, energy bills, the cost of produce, staffing costs, is crippling the industry.”
He explained “the good news” is there’s a general election on the way and put his cards on the table to explain he is a Labour party member and donor.
Manifesto mention
Lord stated: “I have very good communication with the Labour party and I am very, very hopeful we’re going to get help after the general election and I’m also more hopeful we’re going to see [the sector] specifically mentioned in the manifesto.
“I presented a five-point plan at the Labour party conference, which went down extremely well and I got a lot of support on basic suggestions such as rather than Westminster telling the rest of the UK what should happen with licensing, we should have more devolved powers.”
He cited things such as allowing local authorities to give the go-ahead for pavement licensing rather than waiting for Westminster to do so.
Perhaps surprisingly, he gave Rishi Sunak some credit for work he did as Chancellor.
“As Chancellor he was actually engaging quite well with the industry and he introduced things like lowering VAT and the Eat Out To Help Out scheme, as a specific way to help hospitality.
“He did some really good work and understood the importance of sector but since he’s become Prime Minister, a wall has gone up and he’s not interested in talking to anybody at all.”
Lord said his concern now is how much more damage will be inflicted within the sector, particularly during Q1, between now and his 14 November forecast for the general election.
Another closure
“Trade at the moment is extremely tough and, every time I wake up, somebody has tagged me into yet another closure and it’s not necessarily in Greater Manchester – it’s across the UK,” he lamented.
“It’s like a domino effect. It’s heartbreaking especially when you see a pub close because it’s not just a pub, it’s a community hub and when you take it away, it’s ripping the heart out of community.”
Everybody in the entire, Lord claimed, is fighting for a reduction in VAT from 20% to 12.5%, “that is the one simple mechanism that would save the industry”.
“We don’t want handouts at all. My argument has always been 12.5% of something is better than 20% of nothing, which is a closed business.
“And with that 12.5% VAT, you also get all the payee NI on staff and if [a business] eventually becomes profitable, there’s corporation tax for the Government.”
Lord argues even at 12.5%, UK operators are still paying more than 18 of the 26 countries in Europe, and added that while the UK endures 20% VAT costs, the average across Europe for hospitality is between 8% and 9%.
He concludes: “We’re paying 20 times more alcohol duty on a pint of beer than Germany.”
- You can read a Big Interview with Sacha Lord exclusively on The Morning Advertiser website on Tuesday 23 January 2024.
