Tim Rumney, CEO of BWH Hotels GB, on the Spring Statement:
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“Despite some encouragement from February’s decline in inflation to 2.8 per cent, the Chancellor’s Spring Statement does little to ease the pressures on independent hoteliers.
The reality is, with the UK economy shrinking by 0.1 per cent in January and interest rates stuck at 4.5 per cent, many hotels will have no choice but to stop recruiting, cancel investments and hike prices. Not an obvious formula to reach the Chancellor's reduced growth targets - and the last thing hoteliers want to do.
While the proposed increase in household disposable income may offer some hope, the ongoing freeze on income tax thresholds negates this. As wage increases push more into higher tax brackets without a real boost in spending power, limiting disposable income for travel.
This results in guests booking last minute, which is making forecasting harder than ever. Within our partner hotels, the percentage of bookers reserving within a day of arrival has jumped by 10 per cent. Short-lead bookings (under seven days) have also risen by 6 per cent. With booking windows shrinking, hoteliers have less confidence in forecasts, making planning and resource allocation even more challenging.
While no immediate tax rises may provide short-term stability, spending cuts could further hit consumer confidence and spending.
April 1st will also bring higher employer costs, with National Insurance hikes and wage increases further squeezing hotel payrolls. The new Employment Rights Bill also brings the prospect of higher costs and more red-tape, making job creation less attractive. A recent survey of more than 230 of our BWH hoteliers revealed 83 per cent are already cutting staff hours to cope with rising costs.
Despite calls for VAT reductions, business reform, and NICs exemptions for lower-band taxpayers from more than 70 per cent of our hoteliers, the pressure continues to mount. Without real support, our industry is left to face these challenges by ourselves.
In times like these, hoteliers need more than a partner - they need someone who turns challenges into opportunities and that’s something we do best.
The momentum BWH Hotels has shown this year is proof that empowering hoteliers while safeguarding their independence - ‘The Power of Two’ - works. Our five-year plan to allow independent hoteliers to thrive on their uniqueness under our global reach and scale is already paying dividends.
With the government tightening its grip on spending, hotels must adapt fast. While the Spring Statement won’t provide the help many hoped for, with the right support, independent hoteliers can still find ways to succeed.”
