Reeves’s tax raid could spell end of the barman, says pub boss

Pubs may increase the use of app and tablet-based ordering to reduce wages and tax bills

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Rachel Reeves’s £25bn tax raid on businesses could mean last orders for bartenders, industry chiefs have suggested, as higher costs prompt pubs to rely more on apps.
Simon Dodd, the chief executive of pub group Young’s, said he planned to increase the use of app and tablet-based ordering to save money after large increases in employers’ National Insurance (NI) contributions and National Living Wage in the Budget.
Mr Dodd said: “We have our app, which we have over a million customers on. How can we make that more efficient? How can we make order at the table more efficient? How can we use [devices] like tablets?”
The pub chief stressed that Young’s was not looking at job cuts but wanted to drive “efficiencies” through technology. His comments suggest pubs could keep the same number of staff but focus them on delivering food and drink to tables rather than handling orders at the bar.
Such a system may enable them to get through a higher volume of orders, helping to increase revenues while keeping costs stable.
Mr Dodd is the latest pub chief to raise the prospect of fewer bartenders as a result of the Budget. The British Institute of Innkeeping (BII), which represents the pub sector, has said that three quarters of its members plan to cut staff hours, meaning fewer people would be working at any given time.
Steve Alton, the chief executive of the BII, said: “We are calling on the Chancellor to recognise the incredible pressure her Budget has placed on small community businesses, and the impact it will have, including the reduction of team and opening hours, as well as higher prices at the bar.”
Michael Turner, the chairman of pub group Fuller’s, earlier this week said the Chancellor’s actions were a “direct attack on those labour-intensive industries that are the lifeblood of our economy”.
Young’s said the increases in National Living Wage and employers’ NI contributions had added £11m to its costs. The company, which bought City Pub Group earlier this year, employs around 6,500 people and owns more than 280 pubs.
Mr Dodd said: “The NI has been a bit of a shock to the system. National minimum wage was expected, and that was in our numbers, but the National Insurance contribution, especially the reduction in threshold, has been a disappointment from our perspective.”
The Chancellor raised the rate of National Insurance paid by employers from 13.8pc of staff wages to 15pc in the Budget and decreased the tax-free earnings threshold from £9,100 to £5,000. The changes take effect from next April.
Mr Dodd said: “It’s been disappointing, but we’re 193 years old. We’ll work through this and we’ll mitigate as much of the cost as we possibly can without passing a large amount onto the consumer.”
Many venues introduced app ordering during the pandemic for hygiene reasons. However, most rolled back their reliance on the technology after restrictions ended.
It followed warnings from charities including Age UK that older customers were being excluded by venues that had made ordering through apps mandatory.
Some apps also include mandatory fees for the delivery of orders to tables and automatically add tips, leading to resentment that customers were paying more than they would have if they had ordered at the bar.
As well as heralding the onset of app-ordering, the pandemic triggered other changes in Britain’s pubs. Many younger visitors are now unaccustomed to ordering at the bar, forming single file queues rather than spreading out. Several venues have put up signs urging people to move down the bar, with Topsham Brewery in Exeter saying it was “not a Post Office”.
The boss of cafe chain Bill’s told The Telegraph earlier this year that Generation Z diners do not want to speak to waiters in restaurants, instead preferring to order and pay for food through an app.
A survey last year by Prezzo found that 34pc of Gen Z diners suffered from so-called “menu anxiety” – pressure to choose – when ordering from a waiter.
Mr Alton said bartenders were “at the heart of great independent pubs in communities across the UK”.
Mr Alton said: “Technology definitely plays a part in making service smoother, but the fantastic relationships between customers and brilliant pub teams is what makes them so unique.
“Pubs are about so much more than just buying food and drink, they are about connection. Using technology to enhance service is essential, especially to help combat the extreme pressures on small businesses, but for pubs in local communities, they are very conscious of the critical importance of personal relationships with their customers as an integral part of visiting the great British pub.”
A Treasury spokesman said at the time: “By taking difficult decisions we have been able to protect retail, hospitality and leisure businesses on the high street by properly funding the NHS to support a healthy workforce, capping corporate tax and, for the first time, permanently cutting their business rates from 2026.”
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