REACTIVE MEDIA STATEMENT TO THE FURTHER INCREASE IN INFLATION
24 March 2023
The further increase in inflation, driven by the rising cost of food, is not good news, particularly for the hospitality sector here.
Reacting to the rise in inflation, driven by the cost of food going up, Colin Neill, Chief Executive, Hospitality Ulster said:
“The further increase in inflation, driven by the rising cost of food, is not good news, particularly for the hospitality sector here.”
“Higher than normal cost pressures have been around for some time now, with suppliers and outlets doing their best to absorb most, if not all, the increases rather that passing them on to customers. However, with no end in sight, despite the Chancellor stating in his Spring Budget that he is working to reduce inflation, we are seeing suppliers having to pass on more of the costs. The hospitality sector will be left with no choice but to put up prices which will impact customers and drive up inflation even further as hospitality businesses get squeezed even more.”
“We must also remember that the high level of VAT and unaffordable energy costs are also damaging any level of profitability. Whilst footfall and customer spend in general has been better that we expected, profitability has been difficult to achieve, even to a point where many businesses are struggling to break even.”
“This is now the time for the government to be responsive to the industry and take targeted measures on these issues. We need the Secretary of State to intervene to bring forward solutions such as the level of rates relief given to our counterparts in England (70% reduction) as one way that the industry can have some respite against the continued barrage of cost pressures that only ever seem to rise. Simultaneously, we need to see Westminster recognise that we share an island with our nearest competitor who has a VAT rate of 9% and that our 20% VAT rate is simply leaving us uncompetitive.”