Hospitality insolvencies down 9% in May

UK hospitality has a glimmer of hope as new figures reveal a 9% drop in insolvencies, from 301 cases in April to 274 in May. This welcome dip follows a challenging start to the year, with insolvencies rising by 22% in February and remaining high throughout March and April.

Industry experts are hailing this reprieve as a sign of stability, with Saxon Moseley from RSM UK commenting, 'Operators are managing to hang on, helped by the hot weather and May bank holiday.' He also predicts a further boost in demand with the World Cup's arrival, potentially setting the stage for a gradual recovery.

With Andy Burnham poised to take the reins as Britain's next Prime Minister, his hospitality policy agenda will be under scrutiny, particularly with regards to VAT cuts and business rate reductions.

However, the sector is warning that the pressure is far from over. Hospitality businesses continue to face rising costs and a 20% VAT rate, prompting a new campaign called #VATsTheProblem. Industry leaders are calling for VAT to be reduced to 10%, arguing that a fairer rate would help protect jobs, support pubs, restaurants, cafés, hotels and nightclubs, and strengthen high streets and communities. The campaign points out that countries including Spain, France, Italy, Ireland and Germany already support hospitality with lower VAT rates.

Sign the petition at www.vatstheproblem.co.uk