Late-night firms see £4bn in lost revenue due to rail strikes
According to the NTIA, hospitality businesses have already suffered more than £4bn in lost revenue since the industrial action began, leading to a rise in the number of businesses going into administration.
The association stated the number of businesses filing for administration has rocketed by 91% since 2021, with an upswing of 22% in 2023 compared with the previous year, attributed to rising costs and inflationary pressures as well as rail strikes.
Moreover, it claimed the industry accounted for 12% of all business administrations in 2023, the third highest sector in the UK, with 190 of 1,641 notices filed coming from hospitality firms.
Far-reaching consequences
NTIA CEO Michael Kill said: "Our industry is on the brink of collapse, with billions of lost revenue, increased taxes, and the devastating closure of numerous businesses.
“This has not only impacted livelihoods but has also led to a decline in the vibrancy of cities and towns nationwide.”
While the NTIA said it “acknowledged” the action was a “lawful means for workers to express their concerns”, it urged those involved to “consider the far-reaching consequences” and find a solution to “safeguard the welfare of union members and the viability of local businesses”.
This comes as the UK’s largest nightclub operator, Rekom UK, filed a notice of intention to appoint administrators to some its brands earlier this month.
Recent figures from CGA by NIQ also revealed 23,000 licensed hospitality firms have closed since December 2020 while the number of insolvencies across the sector was 37% year-on-year in 2023, according to analysis of data from the Insolvency Service.
Decisive action
In addition, figures from UKHospitality (UKH) released earlier this month estimated industrial action set to take place between Tuesday 30 January and Monday 5 February would cost the sector an additional £350m.
Ahead of the Spring Budget in March, Kill urged the Chancellor and Prime Minister to “acknowledge the critical situation unfolding before them and “take decisive action”.
He continued: “It is crucial they prioritise the well-being of people and address the crisis at hand.
“By implementing a reduction in VAT for hospitality and night-time economy businesses across the board, these establishments will have the financial relief they need to survive."
