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Hospitality industry echoes business calls for utilities and fuel help in the Budget

By Peter Ruddick , 20-Mar-2012
Last updated on 21-Mar-2012 at 12:18 GMT

The hospitality industry has echoed calls from the Forum of Private Business for Government to give more support on utilities and fuel costs to small businesses in the Budget this week.

The Forum has submitted evidence to Ofgem's Retail Market Review, which is exploring ways to protect business energy customers, and has made reducing business costs one of the main pillar's of its Get Britain Trading campaign it launched last year .

Now the organisation is calling on action in the Budget this week to help small businesses get fair treatment from utility companies. Steep rises in utility bills and fuel costs have, the Forum said, hit businesses hard, while they do not enjoy the same protections as domestic customers.

Roll-over contracts

Small businesses particularly struggle from roll-over contracts where they can be tied to more expensive deals with very little warning, stopping them from shopping around. Current rules stop companies from using this tactic on micro businesses with fewer than 10 employees.

The Forum said a business-focused utilities code of conduct was needed to protect all small businesses from this unfair treatment. Senior policy adviser Alex Jackman said this could easily be announced by the Chancellor George Osborne this week.

“This Budget is an opportunity to provide real support for small businesses over steep utilities prices and help them stem the rising costs that are threatening to undermine their ability to grow and create jobs. Better billing practices providing the same kind of protection for business customers as domestic users would be widely welcomed. In particular, we want to see all small businesses guarded against companies exploiting the use of roll-over contracts," he said.

Help on contract terms, a better supplier switching experience and helping boost trust in suppliers are all ideas suggested by the Forum. Research conducted by the organisation has found 75 per cent of businesses want more transparent billing and the same level of information that is provided to domestic customers. 

BHA

Hospitality businesses have echoed the calls for more relief on energy costs, particularly for hotels. A spokesman for the British Hospitality Association told BigHospitality costs were getting more difficult for an industry that already consumed a high amount of energy.

"Hotel industry energy costs averaged 2.9 per cent of turnover in 2004 but in 2010, in England, Scotland and Wales, they rose to 4.7 per cent, 4.3 per cent and 5.5 per cent respectively. Energy is clearly a growing burden for hotels and makes energy-saving measures ever more important. So any help that the Chancellor can give in this area in the Budget would be widely welcomed by an industry that is suffering in exactly the same way as any other high energy-consuming industry," he said.

The Forum is also calling for help on fuel  by introducing a fuel stabiliser to help transport as 92 per cent of businesses have experienced a recent rise in transport costs.

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