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Only a third of hospitality firms optimistic about their future – as average energy prices rise by 81% | UK News

Only a third of UK hospitality businesses are optimistic about their future due to high energy prices and rising food costs, industry bosses have warned.

Pub, bars and restaurants say their energy prices have surged an average of 81% over the past year, on top of rising food and wage bills.

Wholesale gas prices, which rocketed following Russia’s February 2022 invasion of Ukraine, have dipped to their lowest levels since the conflict started.

But with retail prices still falling back into line – and with some pubs and restaurants locked into long-term fixed rate contracts – hospitality bosses say just 29% of businesses say they feel optimistic about the next 12 months.

They say that pubs, bars and restaurants have been at “breaking point for a year now” and warn venues will shut for good if cost pressures do not ease soon.

Four of the UK’s largest hospitality industry groups – the British Institute of Innkeeping, UKHospitality, the British Beer and Pub Association and Hospitality Ulster – have issued a plea to the government for more support.

Food being served at The Hand and Flowers in Marlow, Buckinghamshire that has become the first British pub to receive two Michelin stars.
File pic

In a statement, they say: “The Energy Bill Relief Scheme has provided a short respite but with that falling away last month businesses are back to paying high costs, with no end in sight for the thousands locked into contracts who will be obligated to pay extortionate rates well into next year.

“The government must recognise this crisis isn’t just crippling businesses now.

“Left unresolved it will have a lasting wider impact long into the future, impacting local employment, supply chains and removing essential community hubs from villages, towns and cities across the whole of the UK.”

It comes as data collected by CGA by NielsenIQ on behalf of the groups reveals that 86% of hospitality firms are worried about energy costs going forward.

Last month, analysis of official Government data by the commercial real estate specialist Altus Group found more than 150 pubs have disappeared for good from English and Welsh communities over the first three months of 2023.

This represents a 60 per cent jump on levels from last year.

“Put simply, this data is extremely worrying for thousands of otherwise viable hospitality businesses,” the groups say.

Read more:
Number of restaurants entering liquidation up by almost 50%
Pubs and restaurants cut menu items as inflation pressures mount

The government announced its Energy Bill Relief Scheme – which provides a discount on gas prices for businesses – in October last year.

The scheme, which the government says saved businesses a total of £6.9bn on energy costs, was due to expire in March.

However, it was renewed as the Energy Bill Discount Scheme in January to help businesses, including those signed up to expensive longer-term deals.

The new scheme – which offers a lower level of support than the previous one – is due to run until March 2024.

A government spokesperson said: “Global energy prices have fallen significantly and are now at their lowest level since before Russia’s illegal invasion of Ukraine.

“The new level of government support reflects this welcome fall in prices, but we will continue to stand by businesses.

“We are also assisting the hospitality sector with support such as freezing of alcohol duty, cutting energy bills, a £13.6billion business rates relief package and a £2.4billion fuel duty cut.”

Water firms to face unlimited fines for polluting – as environment secretary accused of ‘national scandal’ | UK News

Water companies could face unlimited fines for polluting under new government plans.

Environment Secretary Therese Coffey is expected to announce measures next week to introduce tougher pollution fines that will be put into a “water restoration fund”.

It comes as opposition politicians called on Ms Coffey to resign over the amount of sewage water companies have discharged into UK waterways.

Labour leader Sir Keir Starmer accused the government of “turning Britain’s waterways into an open sewer”, as new figures showed water companies took no action to reduce pollution despite discharges falling by 19% in 2022.

Sewage spills out of pipes like these whenever there's significant rain in London
Sewage spills out of pipes like these whenever there’s significant rain in London

Liberal Democrats leader Sir Ed Davey accused Ms Coffey of presiding over a “national scandal”, saying she should “now resign or be sacked”.

He said: “These figures are a damning verdict on the government’s failure to protect our treasured rivers and lakes. This is a national scandal and it is happening on the Conservatives’ watch.

“A historic drought is no excuse for this government’s inaction and failure. The environment secretary has let water companies get away with these environmental crimes for far too long.

“It is clear she simply doesn’t care enough to get tough on these polluting firms.

“Therese Coffey must now resign or be sacked so we can have an environment secretary who actually cares about saving our rivers from destruction.”

Environment Secretary Therese Coffey speaking during the National Farmers' Union Conference at the ICC, Birmingham. Picture date: Wednesday February 22, 2023.
Environment Secretary Therese Coffey is expected to announce plans to ‘make polluters pay’

There were 301,091 sewage spills in 2022 according to the latest Environment Agency figures – an average of 824 a day.

This was a decrease of almost a fifth but the falling number of discharges was due to dry weather rather than measures taken by water companies.

Read more:
Good news on fall in sewage spills only highlights the scale of the challenge facing water companies – analysis
Government criticised for ‘repeating’ mistakes on beach sewage spills
Water bosses admit their performance has been ‘unacceptable’

Ms Coffey’s plans also include a six-week consultation examining the possibility of strengthening the Environment Agency’s ability to impose sanctions without going through the courts.

The Department for Environment, Food and Rural Affairs (Defra) said the most serious cases will still be taken through criminal proceedings but that all other penalties would be quicker and easier to enforce.

Currently penalties and fines imposed by water regulator Ofwat are returned to the Treasury but under the new plans, money will instead be returned to Defra.

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Speaking about her plans, Ms Coffey said: “I know how important our beautiful rivers, lakes, streams and coastlines are for people and nature – and I couldn’t agree more that more needs to be done to protect them.

“I want to make sure that regulators have the powers and tools to take tough action against companies that are breaking the rules, and to do so more quickly.

“Through the Water Restoration Fund, I will be making sure that money from higher fines and penalties – taken from water company profits, not customers – is channelled directly back into the rivers, lakes and streams where it is needed.”

Campaigners have accused water companies of discharging sewage far more often than they should, including when there has been no rain, and have repeatedly called on water companies to use their profits to invest in more infrastructure.

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‘Major breakthrough’: Most firms say they’ll stick with a four-day working week after successful trial | UK News

The world’s biggest trial of a four-day working week has been hailed a success – with most of the companies involved saying they would continue offering a shorter week.

A total of 61 companies across several sectors in the UK were involved in the pilot, which ran for six months from June last year.

Employers had to make sure there was no reduction in wages for staff who took part in trialling a 32-hour week.

At least 56 out of the 61 firms which took part said they plan to continue with the four-day working week, including The Royal Society Of Biology based in London.

Chief Executive Mark Downs said productivity had increased.

He added: “There’s been a decline in the number of sick days taken during the period of the trial.

“Before the trial, on average, each person would take four or five sick days per year – that’s down to less than two.

“I think it’s a substantial difference.”

Other firms involved in the pilot have had similar experiences.

Research carried out by the University of Cambridge and Boston College found that the number of sick days taken by the 2,900 staff in the trial fell by about two-thirds.

Also, 39% of employees said they were less stressed.

Tessa Gibson, a senior accreditation officer at the Royal Society of Biology, said she would not want to go back to a five-day week – adding: “Weekends can be quite hectic, so it has been quite nice to have that extra day to see your friends and family, and then you get that extra day off during the week to do all your chores or to have that time to relax.

“It has made a big difference to my mental health.”

The COVID pandemic has meant that employers are having to find more flexible working arrangements in order to attract and retain staff, but not all businesses think a four-day week is the solution.

Jay Richards is the co-founder of Imagen Insights, which helps brands gather feedback from young people.

He said a four-day working week often leaves employees feeling like they have to squeeze more work into fewer days.

“I think a four-day week sounds good in principle but in practice how many companies are going to be able to support employees’ wellbeing if they are going from a normal five-day week and cramming that down into four days?

“We do a five-day week but we work 10am to 4pm, we shorten the days so the employees have that work-life harmony but they’re not actually shortening their week, which I think would put more pressure on them.”

The findings of the pilot scheme will be presented to MPs on Tuesday 20 February.