Pubs and restaurants say they are facing a “catastrophe” as nightmare uncapped energy bills see them hit with price rises of more than 400 per cent.
Owners and workers in the hospitality industry across the UK are urging the Government to step in, warning: “Help us too because nobody can survive this!”
They say they were battered during the pandemic but are now facing an even tougher fight for survival and having to make staff redundant.
The British Beer and Pub Association (BBPA) said 800 UK pubs closed their doors for good during the pandemic and now fear “hundreds more” will now follow.
Chief Executive of the BBPA, Emma McClarkin, said their members have been seeing 150 per cent rises since April and it’s getting worse, while The Mirror spoke to one boss who is facing an “eye-watering” 429 per cent hike.
Emma said: “Without intervention hundreds of pubs and breweries are at serious risk of permanent closure.
“We are calling on the Government to act now and introduce an energy price cap for small businesses before it’s too late.”
While prices to domestic consumers are capped at £2,000 a year for most households now, there is no limit on charges for corporate customers leading to some “crazy” prices.
And pub landlords who live above the shop are also suffering a double whammy - as their domestic bills are untapped too.
But these are the ‘lucky’ ones, as some energy companies are refusing to give contracts to pubs and restaurants fearing the sector is just ‘too risky’ with the public staying home as the cost of living explodes.
Owner Joe Cussens, who runs four pubs as part of the Bath pub company, has had to make a member of staff redundant as a “direct result of the rising energy prices.
“I have been in business for 16 years and this is the first time I’ve ever had to make someone redundant,” he said.
“This is an economic catastrophe in the making,” he said, explaining how his first contract renewal saw energy bills in one of his pubs go from £28,000 a year to £65,000. Two more of his pubs are up for renewal in July.
He said he was “disappointed but not surprised” that the Chancellor failed to help them in this week’s deal.
“It’s great they are helping vulnerable families but meanwhile a lot of small businesses are going bust,” Joe warned, referring to the Chancellor’s energy bills help and windfall tax announcement.
“There’s no cap for businesses and they’re holding a gun to your head, what are you supposed to do? You can’t not have electricity,” he said.
“Energy bills are suddenly the single biggest overhead, higher than your rent. How on earth are you supposed to cope with this?
“The cost of energy unquestionably poses a bigger threat to the sector than the pandemic did; for that crisis support was in place, for this one, nothing.
“It’s a calamity. What I find extraordinary is the Government spending all that money supporting us during the pandemic, only to walk away and throw us to the lions now.”
Jamie Scott, 32, who runs the Newport Restaurant and Newport Bakery near Dundee, has seen his bills go from £17,000 to £90,000 per annum. The standing charge, the cost when you are not using it all, shifted from 22 pence to £4.47 an hour.
“We’re still fighting on but nobody could survive this no matter how big you are. The Government needs to step in,” he said.
Explaining how he felt when he found out his bills had gone up £73,000, he told The Mirror: “all my organs dropped! It’s an absolute shock. That is more than 400 per cent.
“Noone can survive that! I don’t care who you are. Unless something is done, in the worst case, there would definitely be mass closures.”
Jane Turner, from Tubbs of Colne, in east Lancashire, managed to survive through the pandemic and had been “thriving” since reopening.
But now they are being hammered with a 100 per cent rise in energy bills which means they have to find an extra £420 a week, £80,000 a year.
“We didn’t realise how dramatic the hike was going to be. Currently we pay 15p per kilowatt - this is set to increase to 30p per kilowatt - a 100% increase,’ she said.
“Every small business in the country is facing this challenge now, not in October, as the government would have you believe.
“In the next 12 months businesses will be destroyed as most won’t be able to absorb costs like this.”
Referring to the chancellor’s failure to help business earlier this week, Jane said: “It’s completely insane and disgusting.
“They are completely ignoring us and pretending it’s not happening. Businesses need help urgently they can’t bury their heads in the sand.”
Graham Usher, 44, who manages The Inn South Stainley, his bill for next year will increase by 127%, a rise of about £62,000.
“That’s going up overnight from next month. It’s eye watering,” he said.
Their bill used to be £50,000 a year and now it has gone up to £112,000. Now he has to find around an extra £6,000 a month
“We purchased through covid and opened last May. What a Birthday present, here’s a bill for £62,000!” he said.
The chief executive of Admiral Taverns, Chris Jowsey, has 1,600 pubs across the UK and pay the energy bills of 170 pubs directly with the licensee paying 1,400.
Their own £350,000 a year energy contract has now ended and they are now operating at high ‘out of contract’ rates as the only deal they were offered was three times this figure.
“Nobody seems willing to tackle the problem. We’ve written to Ofgem, the Minister for Energy and everyone says; ‘it’s not their problem -it’s just the market!’ he told The Mirror as he called for a cap for those living above pubs.
“First of all they have to protect the people who live above the pub,” he said.
“I am really concerned about the hospitality sector. I think over the next 12 months the industry will lose a lot of pubs on the back of this.”
One of Admirals’s award-winning publicans, Garry Tallent, 60, who runs the Red Lion at Chobham with his partner Sandy, who grew up in a pub, says: “I’ve never known it this bad.”
“There’s nothing else I can do. The pub is my home and my livelihood. I’m in the lap of the gods - if I lose this I lose everything. There’s no profit in it at the moment.
“It’s the perfect storm,” Garry said, who lives above the premises.
“There’s nothing left on the bone any more. I used to pay £2,500 a month (energy bills) and now it’s more than £5,000 a month. My electricity is as expensive now as my rent.
“How can these oil companies make so much money? Billions upon billions. It’s ludicrous.”
He also despairs at the chancellor’s announcement this week: “Our energy bills are going up even more than domestic bills. There’s no cap.
“It’s good what they’ve done to help the most vulnerable but normal people like ourselves and the people who work for us are still in peril. We are working for no profit at all and everyone is scared silly.”
William Robinson, who runs sixth generation family brewer Robinsons Brewery in Stockport, established in 1838, has 24 directly managed pubs and 230 licensees, who they are in partnership with, but says he cannot remember when it has ever been this bad.
He is concerned for their landlords who are also being asked by the energy firms to put up a £6,500 security deposit.
“On average we are seeing gas increasing 250 per cent and electricity 100 per cent. Some are seeing energy bills increasing by four times.
“The biggest one was a £6,000 increase on the gas. That was £10,000 a year combined on that site.”
He said some are having to look at putting 20 to 30 pence on a pint, or closing Monday and Tuesday and he fears good successful small businesses could close.
“They are having to look at how to cut their costs. Energy bills are hitting us hard. They do need support from the Government,” he said.
“Landlords in pubs work incredibly hard and they are really very resilient but there is a sense of nervousness. We are in the eye of the storm.
“Let’s hope the storm will begin to ease...”
