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​Tapped Out: The Impact of Wales' Budget on Pubs and the Hospitality Industry

​Tapped Out: The Impact of Wales' Budget on Pubs and the Hospitality Industry

Posted by Emma on 19th Dec 2023

In Wales, the latest budget spells a challenging time for pubs, shops, and restaurants as business rates rise, a decision made to bolster the strained health services. This adjustment forms part of broader public spending cuts across various departments, with rural affairs facing the most significant reductions. Additionally, funding for arts, culture, and sports is set to decrease by around 10%, potentially leading to new charges at public museums and increased tuition and social care fees.

Finance Minister Rebecca Evans acknowledges the tough landscape: "These are difficult but necessary choices to focus on what matters most to the Welsh people." David Phillips from the Institute for Fiscal Studies highlights the budget's emphasis on the NHS, requiring cuts in other areas for a £730 million health spending boost.

The reduction of business rate relief from 75% to 40% for pubs, shops, and restaurants contrasts with the steady 75% relief in England. Natalie Issacs of Bar 44 Group voices the concerns of many: "This increase of £500 to £1,000 a month puts us at a direct disadvantage compared to businesses across the border."

Further, the budget shows real-term spending cuts for all departments except health. Even with a 1.2% real-term increase in council funding, organizations like the National Museum and Arts Council Wales face about a 10% funding drop.

The NHS, despite receiving additional funds, is grappling with unprecedented challenges. "We are contending with record waiting times and growing financial pressures," a senior NHS Wales official comments. Funding reductions are also planned for programs addressing drug and alcohol misuse, mental health, and obesity.

Meanwhile, Michael Gove’s announcement of a 6.5% funding increase for English local councils underscores the differing approaches across the UK. This rise aims to support social care and housing, though it might not fully mitigate the financial challenges faced by councils.

This budget thus illustrates a strategic pivot towards healthcare in Wales, balancing critical services against a backdrop of economic constraint and drawing both concern and support from various sectors.

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