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Interest rate rises to 5.25% – our response

The Bank of England announced they would be rising the base interest rate by 0.25%, from 5% to 5.25%. The rise is the 14th in a row.

Our Chief Executive Kate Nicholls said: “Hospitality businesses are particularly exposed to further rate rises, due mainly to the Covid loans many were forced to take out during the pandemic.

Yet another rise in interest rates only exacerbates the financial challenges many are grappling with, alongside high energy costs, food and drink inflation and labour shortages.

“The inflationary pressures we’re facing as a nation are supply, not demand, led so we need to see urgent government action to bring down these business costs. A good starting point would be to rapidly implement the recommendations made by Ofgem last week to mitigate the energy crisis.

“We would also urge flexibility on loan repayments, including extension to terms, options to move to interest-only payments or delay altogether, and flexible arrangements from HMRC for tax payments.”