Pubs and restaurants face 'terrifying' price increases

Clients are bracing themselves for steep food and drink price rises, pubs and restaurants have warned.

Ian Wright, chief executive of the UK's Food and Beverage Federation, told MPs that inflation in hospitality was at as high as 18.000 as businesses face rising wage, energy and raw materials costs.

Chief executive Kate Nicholls said: 'There is cost price inflation and already consumers are having to pay more for food services.

Speaking to the Consumer Prices Committee, Mr Wright said: "In hospitality, which is a precursor of retail, inflation is running between 14pc and 18pc.

Figures show wholesalers have seen their food bills rise by 8 to 12 per cent, utilities including gas and electricity jump by more than 50 per cent, and wages have risen by 13 per cent.

Recent figures show prices across the sectors have been rising at an average of 3.2 per cent in the past 12 months.

Since the VAT rate for the sector increased from five per cent to 12.5 per cent, many restaurants have taken on the cost of keeping customers, but owners are concerned about the rate of profit, planned at 20 per cent by 2022.

Britain's Road Transportation Association (RHA) had also warned of a shortage fewer than 100.000 drivers, saying the problem had not improved.