Starmer Stumbled Into a Battle With the British Pub and Lost

A grassroots campaign against business rates changes pushed the Labour party to change policy, highlighting Prime Minister Keir Starmer’s vulnerabilityAuthor of the article:You can save this article by registering for free here. Or sign-in if you have an account.(Bloomberg) — Labour politicians have been barred from Andy Lennox’s pub, The Old Thatch in Wimborne, Dorset, since December. British pubs have been under intense financial pressure in recent years: from Covid lockdowns, higher energy costs, an increase to the minimum wage and a hike in the national insurance payroll tax. Then, the government changed business rates — a levy on commercial premises which funds local services — and ended covid-era discounts. Subscribe now to read the latest news in your city and across Canada.Subscribe now to read the latest news in your city and across Canada.Create an account or sign in to continue with your reading experience.Create an account or sign in to continue with your reading experience.That would have left him with a higher bill, despite a promise from the Labour Party that it would lower taxes for pubs. It was a step too far for Lennox, who coordinated a national campaign of publicans banning Labour MPs from their premises. Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Facing another controversy over its tax policy, the government backed down. The Treasury is due to announce a support package for pubs in the coming days, which will include help on licensing, cutting red tape, and reductions in their tax bills. “We’re now being listened to because we’ve actually hurt them,” Lennox said. “What’s happened is your grassroots backbencher has turned around and said, well, I can’t go to the pub.”Taking on a well-organized business community that maintains a dominant place in the national psyche was always going to be risky, particularly for a government whose popularity has cratered, leaving it lagging Nigel Farage’s populist right-wing Reform UK in the polls. The subsequent U-turn — the latest in a growing list of policy reversals — only adds to the sense of chaos and indecisiveness that has dogged Keir Starmer’s government.“There are very few more potent political enemies to end up on the wrong side of,” said Luke Tryl, executive director of More in Common UK, a political consultancy. “When you think about constituencies that are able to attract popular public support, pubs are right up there.”Business rates constitute one of the Treasury’s biggest earners, with the government due to collect £37 billion ($49.6 billion) in revenues in the next financial year from the levy, with receipts due to rise to £42 billion by 2030.The current rates trouble largely stems from a regular three-year review of the value of commercial premises, which is a key factor in calculating their bill. The last review in 2023 reflected Covid-era conditions, hence values were lower. The new higher rateable values for firms announced alongside Rachel Reeves’ budget in November mean that, in many cases, even though the government has cut their business rates multiplier, they are facing higher overall liabilities. The average pub is set to see its business rates rise 76% over the next three years, according to industry group UK Hospitality.For pubs, higher business rates posed an existential risk. On top of rising infrastructure costs, taxes and wages, the industry has also been contending with structural changes, including Brexit reducing its access to cheap EU labor and a shift in drinking habits among younger people. The number of pubs in Britain has fallen from about 60,000 at the turn of the century to approximately 45,000 today, according to data from the British Beer and Pub Association.“It is effectively a tsunami of things which are hitting us,” said Phil Thorley, owner of Thorley Taverns in Kent, which employs around 400 people, when asked about the increases to business rates. “We will be financially unviable.”For Julian Apperley, 62, who has run The Hare in Tower Hamlets for 25 years, the latest tax hike might be the final hit that forces him to sell up. “I had a really good Christmas, but I look at my accounts: 20 grand in the overdraft. In this game people think you’re loaded but every bean I get goes to paying back tax.” His main worry now is that when he’s gone, The Hare will be converted into a restaurant and leave 250 years of history behind with it. “This pub’s had 20 babies, we’ve had funerals, we’ve had engagements, we’ve had weddings, we’ve had sadness, we’ve had joy, we’ve had everything you can possibly name,” Apperley said. “If that’s not community I don’t know what is.”He says The Hare is still standing because of this; newcomers come in and get hooked on the community culture. Otherwise it would have already found the same fate as most locals. “Since I got here Tower Hamlets has lost more pubs than anywhere in the country. There used to be 14 pubs on Hackney Road … now there’s three.”That’s why the reaction from the industry was so quick and aggressive. Labour MPs were barred, and celebrities — including TV presenter Jeremy Clarkson and pop icon Rick Astley, both of whom are pub landlords — weighed in.

Chancellor Rachel Reeves was banned from her local, the Marsh Inn in Pudsey.The government has not released details of the specific measures that it will take to support pubs. “We recognise the significant value pubs bring to communities and the Chancellor and Prime Minister have been clear that we are determined to support them,” a Treasury spokesperson said in a statement. “The £4.3 billion support package announced at the Budget was the right thing to do to protect the majority of ratepayers from increases to their business rates bills.”Shares in pub operators such as Marston’s Plc and JD Wetherspoon Plc rose this week on news of the government support package.Even if pubs are satisfied by the new package, the government could face new challenges over business rates. The rest of Britain’s hospitality sector is also demanding it receive extra help on tax bills, with groups including nightclubs, hotels and high street shops pleading their case.“The chancellor urgently needs to apply this to the whole sector, not just pubs,” said Sacha Lord, chair of the Night Time Industries Association. “It would be totally unfair to help one part of the sector, whilst leaving another part high and dry.”Pub landlord Lennox said he’ll be keeping up his stance of banning Labour MPs until those other businesses receive support. “Hospitality has to be united,” he said. “Unless this is applied to the whole of hospitality, you can bugger off.”Politically, the U-turn on pubs has raised fresh questions about Starmer and Reeves’ own political judgment and grip over policy detail.The reversal follows on from damaging climbdowns over the scrapping of winter fuel payments for most pensioners, abandoned welfare reforms and a reversal on inheritance tax changes for farmers. The speed of the U-turn also highlighted Starmer’s sensitivity to criticism from his own backbenchers, as speculation grows about a potential leadership challenge to unseat Britain’s premier, who has record low approval ratings. Though Starmer has an apparently commanding working majority of 167 seats in the House of Commons, it would only take 81 Labour MPs coming out in support of a leadership challenger to trigger a contest. Starmer’s Health Secretary Wes Streeting is seen to be a prime contender, with the moment of maximum potential peril for Starmer widely viewed as local elections in May, which could see swathes of Labour losses.“U-turns are some of the most damaging things for Keir Starmer’s brand because it gets to the heart of what people don’t like about him,” Scarlett Maguire, director at pollster Merlin Strategy, said. “Which is the sense that he doesn’t stand for anything. He always goes back on what he says and you can’t trust him.”(Adds Treasury comment in the 15th paragraph.)Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information.