"It's a constant fight": Businesses say government should prioritise addressing more important matters instead of licensing reform
As hospitality businesses face unprecedented instability amid crippling VAT costs, increasing prices and the cost of living crisis - will the government's proposals to scrap the publishing of licensing applications and notices by local papers truly cut the red tape, or simply diminish the public’s access to information?
Earlier this month, ministers launched a consultation on licensing reform, which includes a proposal to remove the statutory requirement for alcohol licensing notices to be advertised in local papers, with Prime Minister Keir Starmer saying the review is to ‘cut the red tape’.
If approved, it would mean that plans to open a new pub or nightclub, or for an existing venue to change its opening hours, would no longer be publicised within local communities.
The News - alongside newspapers across the country - is running a 'Defend Your Right to Know' campaign to ensure our readers can easily see public notices, including alcohol licensing notices, in the highly trusted environment of independent local journalism both in print and online.
We’d like to know how you would feel if those applying for a licence to sell alcohol in your community were no longer obliged to notify the community of this intention - share your views here.
Portsmouth, and its surrounding area, is known for its vibrant streets featuring an eclectic array of independent businesses - from bars to tearooms to restaurants. But the picture is steadily changing with increased closures, making the hospitality industry a revolving door of businesses opening and closing.
The News spoke to a number of business owners across the hospitality sector in relation to the mounting difficulties in running a company, with many raising the extortionate VAT prices as their main concern.
The Akash, a family run Indian restaurant in Southsea, has been part of the food scene for the past 50 years - but despite being well established, it hasn’t escaped the financial pressures of the industry.
Faz Ahmed, owner of The Akash, said: “It is very tough, everyone I speak to says they are in the same boat. We don’t want to put our prices up but it is becoming really hard - I don’t think anybody is safe from this current climate.
“I have noticed that by the end of the month people don’t have any money - it seems people really are living hand to mouth and they are really thinking about when and what they are spending.”
He said the proposals to stop the publishing of licensing applications in newspapers could represent the loss of public transparency.
He added: “It’s important that local communities are aware when premises apply for licences, so transparency shouldn’t be lost. But to be honest, pubs and restaurants have far more pressing concerns right now than changes to licensing advertising.
“The government should be focusing on how to actually support the hospitality sector through this crisis — with measures like VAT relief, grants, or targeted support similar to what was offered during COVID. These are, in many ways, even tougher times for restaurants than during the pandemic. Around two restaurants a day are closing in the UK, which is an extremely worrying statistic. The government needs to acknowledge the reality on the ground and get a grip before things get even worse.”
Southsea Spirit, owned by sisters Harriet Scutt and Charlotte Osgood, opened its doors in Albert Road back in 2023 and despite being a popular spot, the past two years haven’t been without its challenges.
Harriet said: “The amount of red tape, from VAT and PAYE to licensing and compliance, can be overwhelming, especially when you don’t have a big team behind you. You just have to keep pushing through and remember why you started in the first place.
“VAT at 20 per cent is honestly one of the biggest struggles for hospitality. When you’re a small independent bar producing your own gin, like we do at Southsea Spirit, every single price rise hits you twice.
“The cost of ingredients, bottles, labels and even packaging has gone up massively, and that’s before you even think about the running costs of the bar itself. Margins have become really tight, and you can only absorb so much before it starts to affect what customers pay.
“It’s a constant balancing act between keeping prices fair and keeping the lights on.”
The 39-year-old explained that during the first year of trading, the bar almost faced closure due to a ‘lack of support’ which ‘really took its toll’ on the owners, who struggled to find grants or schemes to alleviate the burden.
She said: “Sometimes it feels like you’re fighting through it alone, which is why our customers mean everything to us — they’re the ones who keep us going when times are tough.
“Most people aren’t finding out about local licensing changes from a newspaper these days, so moving that process online feels logical and probably overdue. But in the grand scheme of things, that’s not the kind of reform that’s going to save small businesses.
“The government could make a far bigger impact by tackling VAT, easing business rates or offering real, consistent support for independents. Cutting a print notice might save us a couple of hundred pounds, but it’s not going to solve the bigger problems that keep us awake at night.”
Agreeing that VAT is crippling businesses is Queenie Butler-Hoskins, owner of Queenies Vintage Tearoom, in Emsworth.
After following her dream of opening a tearoom, which doubles as a speakeasy in 2022, Queenie has been faced with such financial strain that she has been forced to sell her house in order to keep her business running.
She said: “It is really really hard. We have to pay VAT which is crazy because we are nowhere near breaking even but because we are taking a certain amount of money HMRC don’t care that we are spending it on costs so we are getting bills of £3,000 to £5,000 that we can’t pay. You can see there is no profit in my business but then they are asking for thousands so it’s a constant fight to keep going.
“I’ve just sold my house to keep going - but this is my dream and we have so many customers that use this as a lifeline. It is more than just a tearoom, it is something really special.
“Personally, I just give up. They just don’t care, they are just like ‘give me our money or go out of business’. There are no payment plans or schemes to help.
“If you want to keep an independent business going, you have to make personal sacrifices and the government just doesn't care. They make it near impossible - they’re the business prevention society.”
UK Hospitality published findings back in August of this year indicating that the sector is 14.2 per cent smaller than it was in March 2020, with two closures a day since the start of the year.
The consultation period for the licensing reform, which will focus on nine key recommendations from the Government’s Licensing Taskforce, will run until Thursday, November 6.