The Paucity of the Chancellor’s Gift: A Closer Look at the Government’s Pub Relief Package

By The Wobbly Editor, 4 February 2026

In the world of political theatre – particularly that practiced by the current regime, few performances are as well-rehearsed as a Chancellor’s last-minute ‘rescue’. Having set the kitchen on fire and been banned from bars across the country, and now facing a brewing rebellion from publicans, industry leaders, and even a growing number of their own backbenchers, Rachel Reeves unveiled a support package for pubs with a flourish of so-called ‘generosity’. The announcement last week of a 15% discount on business rates for pubs and live music venues was presented as a lifeline, a compassionate response to a sector on its knees. The average pub, we were told, would save £1,650 in the coming year.

It’s a narrative though, that is total horse shit. The Government’s package is not a gift; it’s a carefully calibrated act of damage control, a thimble of water to tackle the blaze Rachel ignited. 

 The Revaluation: A Perfect Storm of Feudal Insanity

Every three years, the Valuation Office Agency (VOA) re-evaluates the rateable value of all non-domestic properties in England and Wales. This value, which is supposed to reflect a property’s annual rental value, is the foundation of its business rates bill. The 2026 revaluation, which takes effect on 1 April, is based on property values as of 1 April 2024. For most businesses, this is a routine, if often unwelcome, administrative exercise. For pubs, it’s a perfect storm.

Unlike shops or offices, which are valued on their rental value, pubs are valued on their ‘fair maintainable turnover’ - an estimate of their trading potential. The 2024 valuation date captures a period of strong post-pandemic recovery in the hospitality sector. But it also captures a period of crippling cost inflation. The result is a VOA assessment, conducted by unqualified civil servants, based on theoretical turnover projections that bear little to no resemblance to the reality of squeezed margins and soaring overheads.

And the consequence: The average rateable value for a pub is set to increase by 30%, and for a pub with accommodation, by a staggering 70%. For hotels, the figure is 76%. This is not a gentle adjustment - it is an existential event.  When people accuse the Labour Party of being economically illiterate, this is what they mean.

The 15% Illusion

And it’s in this context that the Government’s 15% “lifeline” must be seen. The discount isn’t a reduction on current bills - it is a small mitigation of a future bill that is already set to explode under thousands of small businesses.

One only has to look at the Government’s own figures to reveal their sleight of hand. Even with the 15% discount, the average pub will see its rates bill increase. The Supporting Small Business (SSB) scheme, which is supposed to protect small businesses from large increases, caps the rise in bills at 15% in 2026/27, 25% in 2027/28, and 40% in 2028/29. The 15% discount is applied after these caps, meaning the underlying increase remains whopping.

Furthermore, the 15% discount is a one-year measure. After April 2027, it disappears, leaving pubs to face the full force of the revaluation. UK Hospitality estimates that by 2027/28, the average pub’s rates will be £4,500 higher than today, and by 2028/29, £7,000 higher.  With a profit margin of around 12p on each pint served, that’s simply unworkable. The Government’s “generosity” is, in reality, a temporary and only partial reprieve from a crisis of its own making.

The South West: On the Front Line

Nowhere is this crisis more acute than in the South West. Our region’s economy is heavily reliant on tourism and hospitality, and its rural communities are disproportionately dependent on the local pub as a social hub. The 2026 revaluation will hit these communities hard.

While the South West’s average rateable value increase of 18% is slightly below the national average, this figure masks significant local variations. Coastal and heritage destinations, which saw a surge in post-pandemic tourism, are likely to face the steepest increases. Pubs in the Cotswolds, Devon, Cornwall, and Somerset, which are the lifeblood of their communities, are now facing a tax bill that bears no relation to their ability to pay.  (But when did that ever stop Rachel, ask the Farmers.)

The closure of pubs across the region to date are not isolated incidents - they are harbingers of what is to come. The Government’s support package will do little to change this. A one-off discount of £1,650 is a pittance for a business facing a multi-thousand-pound increase in its annual tax bill.  An insolvency tsunami is heading our way.

A System in Need of Reform

The 2026 revaluation has exposed the fundamental flaws in the business rates system. It’s a tax that’s no longer fit for purpose, a relic that disproportionately punishes businesses with a physical presence. The Government’s response - a series of temporary reliefs and last-minute U-turns - is a tacit admission that the system is broken.

What is needed is not another sticking plaster, but a fundamental overhaul of the system. Yet this Government has so far shown neither appetite, nor competence, for such reform. Stark contrast to its pre-election promises to “scrap business rates and replace them with a fairer system.”

The crisis facing Britain’s pubs is not an accident. It’s the result of a series of political choices: the choice to maintain a broken tax system and the choice to impose a series of new costs on the hospitality sector.

The Government’s 15% discount is not a lifeline, it is an insult. It’s a cynical attempt to placate a restive industry while avoiding the fundamental reforms that are now urgently needed.

The Wobbly Bottle will return to the question of what a fair and modern business rates system should look like in a future article. For now, it's enough to say that the Chancellor’s gift is one that the pub sector can ill afford.

Until the next round, keep the taps flowing… and stay Wobbly.