A growing number of UK pubs are closing due to rising energy bills and inflation, according to data published by accountancy firm UHY Hacker Young.
According to a report by the company, 512 pub and bar businesses collapsed in the UK last year amid the cost of living crisis, up from 280 in 2021. The company says the number of these insolvencies jumped 83% in 2022. .
“The cost of living crisis, including rising interest rates, has impacted consumer habits, making them less likely to spend on ‘non-essentials’, including a drink or meal in a pub. The rail strikes have also prevented many customers from going to city or town center pubs,say the authors of the report.
Inflation is driving up the costs pubs themselves have to pay for beer and food supplies, the results show. As many establishments have little or no savings or borrowing capacity following the Covid-19 pandemic closures, more are being forced to close.
“It’s a particularly difficult time for pub and bar owners, who have to spend more and more while earning less and less. After a long period of lost income during the pandemic, the cost of living crisis has been the final nail in the coffin for manysaid Peter Kubik, one of the analysts behind the report.
The news comes after the UK government announced plans to drastically cut the support it gives to businesses and public sector organizations to pay energy bills.
The current Energy Bill Relief Scheme, which was introduced in September last year, would have provided £18bn ($22bn) to businesses to help them cope with soaring energy costs. However, the scheme ends in March and a new support package would see funding reduced to £5.5bn ($6.7bn).
“Skyrocketing energy costs have been our members’ top concern for nearly a year now and remain so…As these data show, there is no doubt that energy costs are driving the business failure – people simply cannot afford to make ends meet and have no choice but to close shop, which means a community loses their pub or brewery, along with the jobs and the livelihoods that go with it, for good,Emma McClarkin, CEO of the British Beer and Pub Association, told media City AM
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