Budget 2015: Mixed views on minimum wage rise

19 March 2015 by
Budget 2015: Mixed views on minimum wage rise

Minimum wage hikes and a freeze on petrol costs will have the greatest impact on the hospitality sector, operators predict.

This week's budget - which saw the upper levels of the national minimum wage rise 3% to £6.70 and £5.30 for those aged 21 and above and for 18-20 years olds respectively - was welcomed by a number of foodservice operators and accommodation providers including Alistair Storey and Danny Pecorelli.

Alastair Storey (pictured), chairman of Baxter Storey - which has committed to taking on more apprentices - thought the rise in the minimum wage was a positive move. "I think it makes sense," he said.

Exclusive Hotels boss Danny Pecorelli agreed that employee expectations should be higher.

He added: "We have an internal minimum wage at Exclusive that's above the national minimum wage. I think it is a good thing it's going up so fast as it challenges us to be more creative and teams to be more productive - and it's morally the right thing to do."

Angela Vickers, CEO of Scotland-based Apex Hotels also highlighted the ethics of renumeration, pointing out that the group has a policy of paying above minimum wage. "We have budgeted to do so again this year," she said.

"Pressure from rising fixed operating costs prevent us from being as generous as we would like in this area but we are working on it."

However she lamented a missed opportunity for the Chancellor to build on the contribution made by the sector to growth in the wake of the Olympics.

"There were some industries that were singled out for special assistance but alas not one of the UK's largest employment industries - hospitality."

Jonathan Denby, owner of five hotels in the Lake District and Chair of the Lakes Hospitality Association told The Caterer he found the budget more cloud than silver lining.

He said: "Being a destination that depends entirely on the car, we welcome the continued freeze on petrol but I am bitterly disappointed that the government ignored the brilliant campaign mounted by the BHA for a reduction in VAT for hospitality business.

"The minimum wage is just getting worse and worse and it means we're unable to employ the people we'd like to from Japan, China, Russia or South Africa. It puts us at a massive disadvantage compared to our competitors in Europe."

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