GDP figure shows need to 'unshackle' sector

The latest figures from the Office for National Statistics (ONS), released yesterday (Wednesday 11 September), estimated monthly gross domestic product (GDP) showed no growth in July 2024. It followed similarly stagnant growth in June 2024.

Meanwhile the figure was thought to have grown by 0.5% in the three months to July 2024 compared with the three months to April 2024.

The food and accommodation services segment, including pubs, made some of the largest upward contributions to the data during the period.

Invest and grow 

Consumer-facing services increased by 0.1% in the three months to July 2024, compared with the three months to April 2024.

The largest upwards contributions during this time came from a 1.2% growth in the retail trade followed by a 1.7% rise in output in food and beverage service activities and a 4.2% growth in sports activities and amusement and recreation activities in July 2024.

Kate Nicholls, Chief Executive of UKHospitality (UKH) said: “The lack of overall economic growth in July is disappointing to see, but the month was positive for the sector from a sales stand point with the Euros delivering a 25% boost to total sales on matchdays.

“However, these GDP figures do demonstrate the need to unshackle hospitality and incentivise businesses to invest and grow.

“Key to this is reducing business costs and that starts with introducing a lower, permanent and universal business rates multiplier for hospitality and tourism at the Budget in October.”

Cliff edge 

This week, UKH also urged the Government to provide a solution in avoiding sky-rocketing business rates bills in the upcoming Budget.

A pub with a rateable value of £80,000 could see its rates soar by almost £33,000 if the current rates relief ends on 31 March next year, according to UKH.

The trade body called for a permanent, lower and universal hospitality multiplier, which would start to deliver the Government’s manifesto pledge​​ to rebalance the system and is backed by the Hospitality Sector Council.

Nicholls said: “It is imperative the Government addresses the looming business rates cliff edge at the upcoming Budget, as the sector’s ability to survive and thrive depends on it.”