91探花

Autumn Budget 2024 announcement could impact consumer spending ahead of the all-important festive season for hospitality businesses, 91探花’s latest Consumer Outlook reveals. 

91探花’s survey of 2,000 consumers found 42% of consumers will spend less on Christmas this year if tax rises impact incomes in the Autumn Budget 2024. This increases to 46% for Gen X consumers and decreases to 39% for Gen Z. 

Saxon Moseley, partner and head of leisure and hospitality at 91探花, said: “Despite real wages increasing, if tax changes impact consumer confidence then the hospitality industry may well see a spending hit over the all-important festive period. 

“After a period of steady, but incremental, growth, operators will be hoping to offset the increased cost of employing staff, including implementing new tipping legislation and the proposed changes in the Employment Rights Bill, with a bumper final quarter. However, if consumers get spooked by a “tough” budget then it could be a difficult Christmas for many across the industry, compounding additional cost pressures with reduced demand.”

Charlie Barnes, head of employment law, added: “We are expecting employment costs to rise further following the budget with an expected national minimum wage increase to account for the cost of living. Plus, it’s looking more likely that the chancellor will announce plans to impose NIC on employers’ pension contributions which will hit future remuneration for staff. 

Saxon Moseley continues: “The combination of all these measures will acutely hit the hospitality industry, so tailored support from the government is needed to maintain, and even, accelerate growth. Reforming the business rates system effectively by implementing a new lower permanent multiplier for hospitality is a key policy decision that would help ease cost pressures and deliver more certainty. In addition, bringing our VAT rates into line with our European counterparts would help stimulate demand and, in turn, investment in the industry.”