The great British pub needs urgent help if it is to survive the lockdown
The Angel, Henley-on-Thames
Without a doubt the hospitality sector has been one of the hardest hit throughout the ongoing Covid-19 pandemic, having been shut for 10 out of 14 months. I certainly do not believe many of us foresaw that a year ago when we entered the first lockdown.
The latest research by UK Hospitality shows that the sector will have lost £86 billion in revenue by the end of March 2021 – down 68 per cent. There are now 600,000 fewer jobs in the sector than before Covid hit our shores, despite the unprecedented support of furlough. The sector is also racked with new debt – an estimated £2 billion in rent debt and £6 billion in loans and other finance - which makes the recovery that bit more challenging.
It is fair to say that the hospitality sector has received an unprecedented level of support across VAT reductions, business rate holidays, grants, loans, the Job Retention Scheme, alcohol rates frozen, and a wealth of other measures. The Chancellor said he would do “whatever it takes” – hospitality may just need a little more help.
The much-loved British pub, particularly our community, wet-led pubs and our British brewers, are unlikely to bounce back as quickly as we had once hoped. Our behaviour may have fundamentally changed and we now need to ensure that our wonderful local pubs, particularly in rural communities where they are often the last remaining community asset, are able to return to their former vibrancy at last orders. Pubs are one of the top three reasons tourists visit the UK, and so their survival is also linked to our inbound tourism and its associated economic benefits.
Even assuming the roadmap stays in track, the sector cannot fully reopen until 21st June. Some 60 per cent of pubs may not reopen on 12th April, despite the government relaxing regulations to enable them to trade outdoors more easily. This will mean that the support will taper off before there is a full return to profitability, which is forecast to take at least six months after the restrictions are fully removed. In short, the government’s support is ending far too early relative to its lockdown lifting roadmap.
Calls are increasing for a review of beer duty to target support into our pubs, bars, and clubs, which could be balanced with duty rises in the off-trade, given the ever growing debt the country is in. Our pubs provide a safer environment for alcohol consumption than elsewhere, and we should do all we can to encourage people to return safely as soon as possible.
There are other areas within the broader hospitality sector whose plight is worse than the much-discussed pubs and restaurants, such as our contract caterers and wholesalers. These businesses were not required to close, but their trade has been limited mostly to the public sector, and they have unfortunately missed out on many grant payments.
The wedding industry and its supply chain, quite rightly, have been repeatedly highlighted as a sector in need, the important big day being intricately linked with hospitality. It is estimated that more than 200,000 weddings have been either cancelled or postponed since the first lockdown and that the sector to date has lost at least £6.4 billion, a figure that continues to rise.
Every debate the House has held on hospitality has been over-subscribed, as is my backbench business debate this afternoon, which I applied for this one, as so many of us were unable to speak in the last hospitality-linked debate. MPs across the House have championed this industry and called for support, and the Chancellor has listened.
Whilst I, like so many others, am much looking forward to a return to the pubs in my village, I do fear for their longer term future. I very much hope we can continue the Chancellor’s “whatever it takes” mantra as we emerge from this pandemic to ensure the future of UK hospitality is secure.
Selaine Saxby is the Conservative MP for North Devon.
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