Derbyshire pub boss confronts MP over government pressure on hospitality trade
A New Tupton pub boss has delivered a stark message to North East Derbyshire MP Louise Jones, warning that government economic policy could force him and many other hospitality operators out of business within months.
David Murphy, who took over the New Inn on Queen Victoria Road in 2023, invited Ms Jones to visit the pub on Friday, April 11, so they could sit down and discuss his concerns over a drink.
Long-running pressures on the pub trade and wider hospitality sector have seen many establishments close their doors for good, and David has been considering his own future in light of economic policies introduced by Chancellor Rachel Reeves’ first Budget in October 2024.
David said: “We’ve been concerned since the autumn along with most hospitality and farming businesses because the changes have a disproportionate impact on our industries.
“Trade is steady at the moment but businesses like ours will struggle even if they’re busy and well run. Making ends meet is not easy and these changes make things harder – it’s near-on impossible.”
He added: “I think these are the worst conditions the pub industry has faced for years, when it’s already been declining due to changes in consumer habits. Covid had a profound effect too.
“We need to do more to entice customers to come to the pub, and government needs to do something to support the industry.
“They say they’re doing things like taking 1p off the draught beer tax and letting us stay open late on the 80th anniversary of VE Day, but that isn’t actually helping us. It’s just rubbing salt in the wounds.”
The main policy issues David, his partner Dean and other publicans have been forced to contend with are increases to employers’ National Insurance contributions, a reduction in business rates relief and increases to the National Living Wage and National Minimum Wage – up 6.7 per cent for workers aged 21 and over, 16.3 per cent for 18-20 year-olds and 17.97 per cent for under-18s.
David said: “The effect has been tangible. We’ve had to reduce staffing and work even harder ourselves. I’m doing 95 hours this week and not paying myself a wage.
“We’ve had to introduce some fairly aggressive price rises too, and the regulars have started going elsewhere. If I was in their shoes I might do the same, so I can’t blame them but I also can’t start selling beers for less than we need to try and make a living.
“We previously ran the Black Swan at Ashover and we wouldn’t have survived there with these changes. We’re hoping to turn things around here but realistically, if something doesn’t change, we’ll struggle.
“We will try and be as resilient as we can, to provide the best value and service, we’re hopeful for a good summer for us and our customers to weather the storm. We’ll see where we are in six months.
“If there’s nothing from the government, we’ll probably look to get out of our lease early here. We can’t afford to bankrupt ourselves just to fill a black hole left by previous governments.”
He added: “We were optimistic there would be something in the spring statement to support our industry and nothing came, so I felt compelled to reach out to Louise and Toby Perkins, the MP for our Chesterfield micropub Ginners.
“We’re fighting for our customers’ concerns too, because any cost pressures ultimately roll down to them. If you look at the nightlife in the town centre, it’s a mere smidge of what it used to be. People can’t afford to have a fun night out with friends.
“The social club down the road from us closed on March 31 because it was no longer viable. I’ve no doubt we’ll see more and more venues closing over the next six months and beyond if nothing’s done about it.” David did not vote for Ms Jones at the General Election in 2024, but was pleasantly surprised by her response.
He said: “To be fair, Louise responded straight away, gave us an hour of her time and it felt like she genuinely listened to what we had to say.
“I don’t know what she’s able to do as one MP, and she didn’t agree with everything we said, but she took away some actions to pursue for us and hopefully she’ll speak to her colleagues in Parliament. Perhaps I’m foolishly optimistic something will come in this autumn’s Budget.”
He added: “The main reform that would benefit us is on VAT, that’s one of the biggest burdens we face. We could be following Germany, where they cut VAT for hospitality as a Covid relief measure, and decided to maintain it permanently to support the industry.
“We talked about business rate relief reform too. The Government has committed to doing it but said nothing about what that will look like. Maybe they need to be calculated on a different multiplier for hospitality than other industries to reflect the community and social value a village pub like ours offers.”
“Louise challenged me on how to fund those changes, so I told her to look at the multi-billion pound profits supermarkets are making while they’re selling alcohol cheaper than I can buy it wholesale. That doesn’t make any sense.
“Family businesses are losing their homes and kids’ inheritance to stay afloat. It’s not right if that’s how the country works.”
Following the meeting, Ms Jones said: “I thank David for his time and his thoughts, which I will take on board in my role as the MP going forward. I understand the unique challenges that the hospitality sector faces, and I frequently meet with owners and managers of hospitality business to hear their concerns directly.
“I agree with David that the sector needs more support, and I will be discussing with my colleagues and the Department for Business and Trade about what more can be done.”