Chancellor tells hospitality groups energy bill support is ‘unsustainably expensive’

Chancellor Jeremy Hunt has told business groups that the current level of energy bill support is “unsustainably expensive” and cannot continue at its current rate.

UKHospitality and the British Beer and Pub Association (BBPA) were among organisations which met with Hunt to discuss the issue on Wednesday (4 January).

He is understood to have told the meeting that no government could “permanently shield” businesses from high energy prices.

The £18b Energy Bill Relief Scheme launched in October and is due to end in its current form after six months. However, hospitality operators have told The Caterer it has been unclear how deductions have been applied to their bills.

Hunt will set out how help with businesses’ energy costs will continue beyond March 2023 in the House of Commons next week.

Any future aid, while at a lower level, will be designed to help businesses avoid a “cliff edge” of support. However, The Times has reported levels of support could be more than halved.

The Treasury believes extending the scheme at current levels could cost tens of billions of pounds, especially if energy prices increase further than expected.

Both UKHospitality and the BBPA have warned a major cut in support could see many more venues close their doors.

Emma McClarkin, chief executive of the BBPA, said: “We met with the Chancellor…to underline the challenges the industry face and the critical importance of extending the energy relief support to avoid significant business failure and the closure of many pubs and brewers.

“Without extended support at close to current levels, pubs and brewers in communities across the country could be lost for good.

“Energy costs are the single biggest threat to our industry right now. The failure to safeguard pubs and breweries from price increases come April will be the last straw for businesses who have been struggling for three years to remain solvent and serving their communities.”

The meeting was also attended by the Confederation of British Industry, the Federation of Small Businesses, the British Chambers of Commerce, the Institute of Directors and Make UK.