The UK is an expensive place to run a business, particularly in the hospitality industry. Andy Maciver argues that by crippling the hospitality industry we damage not just the economy, but society too.

You haven’t really eaten spaghetti alla carbonara until you’ve eaten it in Lazio, its Italian home. I know, I know, you were at an Italian restaurant in town at the weekend and you ate spaghetti alla carbonara, but in actuality you only think you did. Until you’ve consumed it in a Roman trattoria, you haven’t really consumed it at all. For a start you probably had it with pancetta or smoked bacon, rather than with the traditional guanciale (cured pork cheek). You probably had a cream based sauce and parmesan cheese, rather than an entirely egg-based sauce with pecorino romano. It’s just different. It’s eggier, it’s richer, it’s meatier - and it’s much, much cheaper.

I’ll cease the amateur imitation of a food critic now, because it’s the final point - the price - which stayed with me as much as the taste when I left a restaurant in the centre of Rome a couple of Fridays ago. At €11 for my carbonara, €3 for my starter (supplì, if you’re interested - fried rice balls with mozzarella and ragu) and another €11 for a litre of house white wine (don’t worry, not all for me), my pockets still felt fairly heavy as I departed.

I felt my temperature rise a little, though, as I thought about how much it would have cost to feed the family the same meal at an Italian restaurant back home. I couldn’t quite resist checking. The answer is that a fairly mid-range Italian in Edinburgh, spaghetti alla carbonara will set you back something around £17. You would not get any kind of starter - let alone a handmade, authentic dish - for less than £6. And for the price of a litre of wine in my Rome trattoria, you’ll be lucky to get a large glass.

Anas Sarwar’s gamble on Starmer may be risky – but it might save him

Changing the name of SQA will do nothing to improve failing schools

I know what Scottish politics needs - more Lib Dems. Hear me out

Sarwar can’t escape Starmer and no amount of money will help him

The question is, why? The answer which we can, emphatically, rule out is that our restaurants are profiteering. This is clearly not the case. On the contrary, it is accepted across the business and political community that the hospitality industry is operating on wafer-thin margins.

The answer, I am afraid, is that Scotland and Britain are cripplingly expensive places to operate a business, both in the hospitality industry and elsewhere in the economy. The key piece of understanding, though, is that every factor which contributes to the high cost of operating a business in this country is in the gift of both the Scottish Government and UK Government to fix.

There are some obvious factors which contribute to the aforementioned Italian meal costing up to double the price here than it does in its home of Rome. Some are intractable; we cannot produce Roman wine in Edinburgh, nor can we claim to be the home of authentic Italian pasta. So, there are some import costs, which have not been aided by Brexit and its aftermath.

However, even in a grocery store or off licence, we should not ignore how much of a, say, £20 bottle of wine goes straight to the government in tax. The answer is around £7 of it. Take that off your bill and things already start to look rosier.

Consider, then, the cost of the premises in which a restaurant operates. In no small part because of our sclerotic planning system, which is slow and unresponsive at creating the spaces, commercial rents are high. 

Energy prices, it will be unsurprising to hear, play an oversized role. Business electricity prices in the UK are around twice that of the average EU country. It will not be lost on readers that these other EU countries do not have anything close to the scale of either hydrocarbon or renewable energy production that we have here in our own country, and yet here we are paying the highest prices as a result of the policies and management of our governments.

Over-regulation in the food and drink industry does not help, and both at UK and Scottish Government levels looks likely to continue to be more burdensome, not less so.

And then there are staff costs, of course. If Sir Keir Starmer does eventually depart 10 Downing Street opinion polling would suggest that few tears will be shed, but if he is replaced by his former deputy Angela Rayner, then the hospitality industry and businesses throughout the economy may have more reason to cry. The increase in the national minimum wage is causing recruitment challenges, and if Ms Rayner’s hitherto junked workers’ rights regulations make a comeback, hiring staff will scarcely be worth the bother.

The impact of the Government's National Insurance rise continues to be felt, and continues to suppress the hiring of staff. There are other tax burdens, too. British businesses cannot complain too much about Corporation Tax - it is fairly middle-of-the-road in European terms - although of course it could always be lower. However they can legitimately complain about business rates, which can be utterly crippling. This is particularly true, at the moment, in Scotland, where a looming revaluation is of grave concern to the hospitality sector. To their credit, the Liberal Democrats extracted a concession from the Scottish Government as part of the Budget discussions, but it does not entirely allay concerns, and it certainly will not lead to tumbling prices on Scottish menus.

The point is, of course, that our spaghetti alla carbonara is £17 and Rome’s is €11 because of policy choices that we - our governments here in Scotland and the UK - have made. Some of those policy choices are new, and some are long-standing, but they are all ours. We own them all, and we can change them all if we want to.

And we should. Private enterprise is the engine of any country. It provides jobs, most obviously, but it also pays the business and personal taxation which funds all the public services we see around us, from roads and railways to schools and hospitals. We do a good job, in this country, of ‘bashing billionnaires’, which is political code for an anti-private sector agenda. 

That is a perilous pursuit. Perilous for the economy, obviously. But perilous for society, too. In addition to the quality and the price, a third memory came home with me after that Friday night out in Rome - the clientele.

Eating out in other European countries is a family affair. It is a time to gather, talk and bond, outside of the house, away from smartphones and, crucially, for an affordable price. By pricing families and other social groups out of going out for dinner together, we damage the hospitality industry, obviously, but we must also understand the damage we do to the cohesiveness of society.

Andy Maciver is Founding Director of Message Matters, and co-host of the Holyrood Sources podcast

© Herald Scotland