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Hospitality Leaders Are "Devastated" By Government's Plan To Keep Indoor Pubs And Restaurants Closed Until Late May

Hospitality Leaders Are 'Devastated' By Government's Plan To Keep Indoor Pubs And Restaurants Closed Until Late May
3 min read

Hospitality groups have expressed dismay over the government's decision to delay the re-opening of indoor hospitality until the end of Spring and have warned that thousands of pubs and restaurants will need major financial support to survive.

Kate Nicholls, chief executive of UKHospitality, said the industry was "devastated" with the details of the government's "Roadmap" for gradually lifting lockdown restrictions in England.

Pubs and restaurants will not be able to resume indoor service until May 17th at the earliest, Prime Minister Boris Johnson announced on Monday afternoon. Outdoor hospitality will be able to restart five weeks earlier on April 12th, as well as the sale of takeaway alcoholic drinks.

However, Nicholls said that only 40% of hospitality businesses have outdoor areas and those which do "will see businesses trading below sustainable levels" due to restrictions imposed on them.

People using outdoor hospitality during this stage of the government's plan will be limited to groups of six, or two households. 

Nicholls urged Chancellor Rishi Sunak to help hospitality businesses stay afloat by keeping the VAT reduction and business rates holiday in place and agreeing to a targeted extension of the furlough scheme when he announces his Budget on March 3.

 "The Chancellor has just nine days to save thousands of businesses and hundreds of thousands of jobs that simply will not be there without a substantial package of compensation.

"According to the latest government data nearly two-thirds of hospitality businesses will run out of cash before May, before they are allowed to re-open," she said.

James Calder, chief executive of the Small Independent Brewers Association (SIPA), echoed Nicholls, telling PoliticsHome that many breweries would collapse before the planned return of indoor hospitality on May 17th unless they received more finacial support from government.

"May 17th is 84 days away and the average small brewery will probably burn through about £12,500 before that point, even with limited outdoor trading throughout April," he said.

SIPA wants Sunak to give breweries grants to last them until indoor hospitality is expected to resume in late Spring. The body estimates that a nationwide grant scheme for breweries would cost around £36m.

Calder said: “If we don’t get more financial support in 10 days time, just as we get to the end of this, we’re going to see breweries who have managed to weather the storm start to crash.

"That’s my biggest concern. It’d be an absolute tragedy if those that have survived this long fail at the final hurdle.

“Those businesses are not going to be able to help bring down the national debt and fund our public services if the Chancellor doesn’t sign the cheque to get us through this”.

Nick Mackenzie, chief executive of Greene King, said the popular pub retailer was "disappointed" to not be re-opening at the same time as non-essential retail and hairdressers.

“Opening pub gardens in April simply isn’t viable so many pubs will have to remain closed and, with a phased reopening from May, next week’s Budget needs to bring positive news as we continue to burn tens of millions of pounds in cash every month," he said.

Ian Wright, Chief Executive of the Food & Drink Federation, accused ministers of ignoring the hospitality industry. The government's roadmap shows "shows no signs of taking account of any input from business," he said.

"For a great many of the food and drink manufacturers supplying the hospitality and food service sectors, a return to ‘business as usual’ seems an awful long way off".

Food & drink manufacturers that supply goods to hospitality businesses will need "additional support" from the Treasury to survive, he warned.

Johnson this afternoon told MPs that lifting restrictions quicker than as set out in the Roadmap would risk the need for another lockdown further down the line.

"The chief medical officer is clear that moving any faster would mean acting before we know the impact of each step, which would increase the risk of us having to reverse course and reimpose restrictions, I won't take that risk,” he said.

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