Pubs, restaurants and cafes expect business conditions to remain difficult in 2010 and intend to implement reductions in staff numbers and pay to cut costs, according to new research. The research, which was conducted by insurance company Aviva, found that 26% of hospitality businesses will be reducing staff hours and pay compared to other SME sectors surveyed. It also found around 20% expect to have to reduce the number of permanent staff to keep their business healthy. It also discovered that 44% are planning on more sales and discounting in 2010 and that 33% fear falling sales. In conjunction with the British Chamber of Commerce commissioned poll more than half, 56% of those questioned, said they were concerned about the consequences of any potential increase in VAT to 20%. The hospitality trade appears to be pinning its hopes on the impact of the General Election to improve its fortunes, with 66% believing that the General Election will have a 'significant impact' on the business environment for SMEs in the future.