Exclusive:Scottish venue openings to be scaled back as larger hospitality firms 'hung out to dry by SNP Budget'

Larger hospitality firms have been “hung out to dry” by the Scottish Budget and are now pulling back on investment, a business body has warned.

The Scottish Hospitality Group (SHG), which represents hospitality firms across Scotland, said hundreds of jobs have been put at risk by the spending plans. Chancellor Rachel Reeves announced a 40 per cent relief on business rates for the retail, leisure and hospitality sectors down south as part of the UK Budget.

But the Scottish Government's scheme is more restrictive and will only apply to hospitality businesses with a rateable value of up to £51,000.

The Scottish Hospitality Group urged SNP ministers to rethink their plans | Peter Summers/Getty Images

The SHG said some of its larger members are now considering pulling back on investment in new projects, such as opening more venues in Scotland. This could put tens of millions of pounds of investment at risk, it said, equating to hundreds of new jobs. The body urged the Scottish Government to rethink its plans.

Stephen Montgomery, director of the SHG, said: “The Scottish Government Budget has hung the licensed hospitality sector’s biggest, family-owned employers out to dry, and it is clear this is already putting jobs and investment at risk.

“A large majority of our members are hugely successful, entrepreneurial, home-grown Scottish licensed hospitality businesses employing thousands of people, but some are now privately reconsidering tens of millions of investment, which would equate to hundreds of jobs being lost.

“Coupled with the UK government’s decision to raise employers’ National Insurance contributions, this is real growth and real opportunity being lost because both the UK and Scottish governments are failing to support the licensed hospitality sector in Scotland.

“It is now vital that the Scottish Government recognises that all licensed hospitality premises need support, and they must use the time remaining to urgently amend the Budget.”

A Scottish Government spokeswoman said: “The draft Scottish Budget brings forward measures to provide support for the hospitality sector, including offering 40 per cent relief - capped at £110,000 per business - for hospitality premises eligible for the basic property rate.

“Other benefits in the Budget for the hospitality sector include the most generous small business rates relief in the UK. Around half of properties in the retail, hospitality and leisure sectors will continue to be eligible for 100 per cent small business bonus scheme relief.”

Mr Montgomery previously challenged Kate Forbes, the deputy first minister, over support for the hospitality sector at a business event in Edinburgh following the Budget. She suggested she would like to see opposition MSPs push for more support.

Ms Forbes, who also holds the economy brief, told the event: "In terms of hospitality, there's no doubt about the hugely challenging period that you've been through.

“And although this doesn't go as far as you would like, I can't tell you how relieved I am that after two years where there has been no retail, hospitality and leisure relief, that this year there is - I accept more limited than you would like."

Ms Forbes added: "The starting gun has just been fired for the Budget, and I would like to see all of Parliament coalesce around the importance of supporting our businesses and supporting our economy."