MPs back wholesalers’ calls for business rates relief

More than 50 Members of Parliament have joined FWD call for food and drink wholesalers to receive the same government financial support as their hospitality sector customers.

In a cross-party letter to Chancellor Rishi Sunak, 31 parliamentarians say it is a “clear anomaly” that food and drink wholesalers are not eligible for the business rates relief and other measures available under the Hospitality, Retail and Leisure Grant scheme.

A further 21 MPs have written independently to the Chancellor to echo the request for inclusion.

The letter says: “This sector, which is crucial in supplying food, drink and household items to rural areas and critical public services such as care homes, hospitals, and schools, faces a crisis on a scale never seen before.

“A very significant proportion of the businesses in the sector do not qualify for the financial support schemes that the government has made available and they are not in a position to take out loans.”

The MPs say that foodservice wholesalers have seen a 70-80% loss of business during lockdown, with some trading as much as 95% down. 

A Defra survey of FWD members found that nearly 50% of respondents, all of which have a turnover of £45 million or lower, are in danger of going into liquidation by the end of the year.

The letter states: “These businesses have £270m of public sector contracts and the supply of food into critical public sector infrastructure is at risk and there are few other suppliers who can readily fill this gap. 

“If the situation continues this will dramatically impact the food supply chain and the most vulnerable in our society, such as those in poorer communities and rural areas, and others providing essential services at this time will be unable to access the most basic catering needs.

“Business Rates Relief has been extended to retailers, including supermarkets, and to hospitality and leisure. Failing to include food and drink wholesale in this list is a clear anomaly given that this sector is a key part of the food and drink supply chain to those businesses. It will impact on the supply of food and drink to critical parts of our public sector infrastructure and lead to unemployment in core in regions of the UK, including the north east and north west.”

Among the signatories are former Conservative party leader Sir Iain Duncan Smith and former Labour Shadow Chancellor John McDonnell. Mr McDonnell is also among a number of MPs who have tabled parliamentary questions asking the Chancellor if he will extend the hospitality, retail and leisure grants to the wholesale food and drink sector.

“There is widespread recognition among parliamentarians that, as an integral part of the machinery of economic growth, wholesalers need the same support as the restaurants, pubs, hotels and workplace caterers they supply and support,” said FWD Chief Executive James Bielby.

“Without significant support for its distribution network, our members’ customers
cannot recover as quickly as they or the Treasury would wish, which will delay economic regeneration, at a cost of job losses and business failures. Immediate investment in the supply chain is essential for the smooth and swift recovery of the hospitality sector.”

FWD members have enlisted the support of their constituency MPs through a series of calls set up on their behalf by FWD.

coronavirus covid-19 FWD Government James Bielby MPs