Across town centres and city high streets, hospitality businesses are bracing for what many fear could be a brutal year ahead.
From pubs and cafés to hotels and theatres, operators say rising costs are pushing them closer to the edge.
That growing anxiety has now spilled firmly into politics, with senior Labour figures urging urgent action from the Treasury.
Andy Burnham Calls for a Rethink on Business Rates
Greater Manchester Mayor Andy Burnham has stepped up pressure on Chancellor Rachel Reeves, arguing that the entire business rates system is no longer fit for purpose.
Speaking at an Institute for Government conference, Burnham said the current setup needs “rebalancing,” adding that business rates reform should sit alongside a wider overhaul of land and property taxation, including council tax.
The former Cabinet minister, often mentioned as a potential future challenger to Keir Starmer, made clear that relief should extend beyond pubs and cover the wider high street.
He suggested that any support package could be partly funded by increasing taxes on online retailers, which many bricks-and-mortar businesses see as enjoying an unfair advantage.
Treasury Stands Firm Despite Cabinet Pressure
Burnham’s comments landed at a sensitive moment.
The Chancellor is already facing growing pressure from within Cabinet to offer broader business rates relief to hospitality firms.
While the Treasury signalled a significant U-turn last week by easing pressure on pubs—after warnings that hundreds could shut due to sharp rate increases—it has so far resisted calls to expand support to other parts of the sector.
Industry leaders argue that limiting help to pubs ignores the reality on the ground. Cafés, restaurants, hotels, music venues, theatres, and independent shops all face similar cost pressures, and many say they are equally vulnerable.
Industry Warns of Thousands of Closures
Hospitality bosses paint a stark picture of what lies ahead without intervention.
According to industry warnings, as many as six venues could close every single day over the next year—adding up to more than 2,000 lost businesses.
Kate Nicholls, chair of UK Hospitality, summed up the mood bluntly, saying the sector needs a joined-up response. “A whole hospitality problem needs a whole hospitality solution,” she said.
The figures behind that warning are sobering.
UK Hospitality estimates that the average hotel will see its business rates bill jump by £28,900 in the first year alone, rising to a total increase of £205,200 over three years.
Pubs, meanwhile, are facing an extra £1,400 a year initially, climbing to nearly £13,000 over the same period.
Calls Grow for Deeper Discounts on Rates
To prevent widespread closures, UK Hospitality is urging ministers to dramatically increase business rates discounts—up to the maximum level allowed for hospitality firms.
Behind the scenes, there are signs that Downing Street may be open to a broader fix.
One government source suggested there is a desire to introduce a single, comprehensive package rather than piecemeal changes.
The aim, the source said, is to “do it once and get it right,” avoiding repeated and politically damaging U-turns.
Mixed Signals from Government Ministers
Business Secretary Peter Kyle has hinted that support should not stop at pubs.
He confirmed he will be discussing the issue with the Chancellor this week and said the government has been listening to the hospitality sector for some time.
Talks with industry representatives were held in Birmingham recently, and Kyle described discussions with the Treasury as “vigorous” but still “collegiate.”
Despite those signals, the Treasury continues to insist there are no plans to extend business rates relief beyond pubs.
One source suggested hotels and restaurants might instead benefit from wider licensing reforms, while direct help on rates would remain “pub specific.”
Labour MPs and Coastal Communities Join the Debate
Labour’s internal discussions are also intensifying.
Polly Billington, MP for East Thanet and chair of Labour’s group of coastal MPs, said ministers are having “genuine conversations” about how to support small hospitality and retail businesses, particularly in seaside towns that rely heavily on tourism.
Still, critics say those conversations are not yet translating into concrete help.
Brewing Industry Accuses Government of Targeting Pubs
Anger is especially pronounced within the brewing industry.
Richard Bailey, chair of the Independent Family Brewers of Britain, accused the government of piling pressure onto pubs already struggling with higher alcohol duty, rising minimum wages, National Insurance, VAT, corporation tax, green energy levies, packaging taxes, and inheritance tax.
He warned that these combined costs could “decimate” a sector that plays a vital role in local communities and employment.
According to Bailey, going to the pub is becoming increasingly unaffordable, and many locals may find their favourite venues closed more often—or shut for good.
He also claimed that pubs are being treated as a “whipping boy” by HM Revenue and Customs and the Treasury, which he said are ignoring repeated warnings from the industry about closures and cultural loss.
Political Fallout Reaches the Bar
Tensions have already spilled into public protest.
Around 1,500 pubs reportedly banned Labour MPs from their premises following the Budget, reflecting the depth of frustration across the sector.
Bailey, who also chairs Daniel Thwaites brewery, said political leaders appear to have lost sight of the importance of pubs—or simply no longer care.
The result, he warned, could be the erosion of a cornerstone of British social life.
What’s Next?
With closures looming, ministers face a growing choice: stick to limited, pub-only relief or roll out broader support for a hospitality sector that says it cannot survive without help.
As pressure builds from mayors, MPs, industry leaders, and business owners, the coming weeks may determine whether high streets stabilise—or continue to empty out.
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