Hospitality wants jobs recognised. The Budget may only see tax.

The Budget arrives on Wednesday and hospitality has a long list of demands: permanent business rates reform, a beer duty freeze, lower employment costs, the overnight visitor levy scrapped or capped, and a lower rate of VAT. Some items look likely to be ticked off, notably the rates threshold rising from £12,000 to £18,000. But the sector does not speak with one voice. Pubs have already secured a 20% rates cut from 2027, while restaurants and hotels were left out and now face the visitor levy on top. Large operators are coping; independents are not. The test is whether a Budget that helps some parts of the industry and ignores others can fairly be said to have delivered for hospitality.

In The Numbers, I look at the cost shock coming next year. El Niño is already as strong as the 1982-83 event and still building. The direct impact on UK footfall will be modest, but the supply chain impact will not: rice, palm oil, coffee, cocoa, tea and wheat are all exposed, and food manufacturers expect food inflation above 6% in 2027, against little more than 1% this summer. Indian, Chinese and Thai restaurants, coffee chains and fryer-heavy quick service will be hit hardest; British-menu pubs least. Costs will rise. The real question is whether operators can pass them on to consumers who have learnt, repeatedly, to eat out less when prices go up. 

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