Calorie labels and plastic laws threaten productivity, says UKH

Mandatory calorie labelling, allergy labelling reform and a deposit return scheme (DRS) are all threatening “healthy and improving” levels of productivity in the hospitality sector, according to a new report.

The sector’s turnover has reached £130 billion a year, with compound annual growth rate of around 5.5% – better than any other industry over the past eight years, noted UKHospitality in its Future Shocks report, produced in association with CGA.

However, only 28.2% of those involved in the CGA’s business confidence survey felt hospitality is more productive than other sectors. This “relatively downbeat view” is reflective of tough market conditions, UKH noted. Gross value added has also slowed due to major costs pressures, including the national minimum and living wages, rising rents and food price inflation.

Businesses are also being “swamped” by red tape, UKH claimed. UKH was particularly critical of plans to introduce calorie labelling on all out of home menus, calling it “a case study as to how regulation could seriously effect productivity”. The pros and cons of such a policy are still hotly debated – and will be until the government makes a decision.

“…there needs to be a balance between what is required to keep our customers safe and secure, and what businesses are already doing themselves effectively without the need for masses more regulation,” UKH noted.

There is also concern about the impact of a DRS on businesses. Plans for a scheme in England, Wales and Northern Ireland will go through a second consultation next year, with rollout unlikely to be before 2023.

Scotland however is pressing ahead – the government has just published draft legislation for its own national scheme that will see a 20p deposit applied to aluminium and steel cans, as well as drinks containers made of glass and PET plastic. This will be “fully operational” by April 1st, 2021 – a “ridiculous” timetable, according to retailers who spoke to The Grocer this week.

The UKH report is available here:

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