Hospitality businesses ‘falling like dominoes’ as costs rises

Kelly Broderick wipes away tears as she cleans her restaurant ahead of handing the keys back to the landlord.

After eight years, the Newquay resident says “insurmountable” increases in costs – from wages to the price of cooking oil – have led her to make the “heartbreaking” decision.

It comes as Cornwall Chamber of Commerce also warns businesses have “nothing left to give” ahead of the Budget on Wednesday.

The government says “pubs, restaurants and cafes are vital to local communities” adding it is cutting the cost of licensing and lowering their business rates.

Miss Broderick says she took on personal debt to try and keep her business afloat but adds she “can’t face the rising costs anymore”.

“Wages, National Insurance contributions, product costs, utilities, insurance – everything costs so much more than it used to,” she continues.

About 80 meals per evening were served at The Fish Bar – Miss Broderick’s seafood and tapas restaurant, during the busy summer months.

The business had two full-time employees, an apprentice and about 15 part-time members of staff.

“You put your heart and soul into building your dream but everything is against you,” she explains.

She says she found customers were not “coming out as often or spending as much as they did”.

“Don’t come back and ask businesses for more because there is nothing left to give,” says John Brown, of the Cornwall Chamber of Commerce, to Chancellor Rachel Reeves.

Speaking at a meeting of the Cornwall Hospitality Collective, he explains the government needs to do more to “incentivise businesses to grow and hire more people”, adding the measures announced in the last Budget “had not made things any easier”.

The government says it does not comment on speculation around changes to tax outside of fiscal events.

Simon Mahon, chief executive of Watergate Bay Hotel, says he wants some good news from the chancellor.

“I’m hoping for a cut in business rates for those in hospitality, and tax relief for businesses that are investing,” he explains.

Mr Mahon adds he also wants to see a review of the impact of the increase in employers’ National Insurance contributions, which he says have had a “punitive” impact on hospitality and led to jobs being lost.

“Pubs, restaurants and cafes are vital to local communities, that’s why we’re cutting the cost of licensing, lowering their business rates and helping more hospitality businesses offer pavement drinks and al fresco dining, on top of cutting alcohol duty on draught pints and capping corporation tax,” a government spokesperson says.

They also say 43% of employers (865,000) will pay no employer National Insurance contributions this year and that the government is supporting businesses with expert advice to cut energy bills and emissions.

Back at The Fish Bar in Newquay, Kelly Broderick says closing the business will also be a “relief after all the stress”.

She adds: “You try and make something successful and it’s not viable – that’s what really hurts.”