Hung Parliament: What does it mean for Hospitality? By Neil Gerrard

9th June 2017

The hospitality industry was left scrambling to understand what a hung Parliament means for the sector after the Conservative party failed to win an overall majority.

Theresa May’s bid to create “stability and certainty” ahead of Brexit negotiations, which start in just 11 days’ time, by building a solid majority in the House of Commons, appear to have failed.

Labour leader Jeremy Corbyn, whose party performed better than expected, winning 261 seats (a gain of 29 seats) called on the prime minister to resign.

However, May has refused calls to do so and will attempt to form a government.

Commenting on the result, Ufi Ibrahim, chief executive of the British Hospitality Association, said: “The general election result means that we will be faced with the reality of greater and continued political uncertainty in the short term and that is bad for the economy and business . This is the last thing the hospitality and tourism industry needs as we already face a ‘perfect storm’ of issues but the BHA will work with whatever government emerges to see a return to stability and certainty so that we can get on with creating jobs and growth in the economy.”

Meanwhile, EU commissioner Gunther Oettinger said that talks about Britain leaving the EU might not now start as planned.

Speaking to German radio, he said: “We need a government that can act. With a weak negotiating partner, there’s the danger than the negotiations will turn out badly for both sides… I expect more uncertainty now.”

Paul Hardy, Brexit director at law firm DLA Piper, said the result would pose significant challenges for business.

“Businesses may find it even more difficult to make big decisions on jobs and investment, given this result’s implications for Brexit negotiations, as well as on coherent policy making at home,” he said.

But not everyone shared that view. Simon French, chief economist at investment bank Panmure Gordon, added: “The result is good news for the UK growth outlook as it reduces the likelihood of Brexit taking place, and certainly diminishes the likelihood of a hard Brexit.”

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