Letters

The industry needs help to help itself

Nobody wants to see money wasted on bailing out unviable businesses (Caterer, 19 April, page 4), but we are talking here about perfectly good businesses - hotels, guesthouses, pubs and restaurants - which have seen their income fall off a cliff through no fault of their own. You cannot run any business without customers, but I have met many people in the past few weeks who have been left trying to do just that. Their income has dried up.

The Government has so far offered not much more than sympathy and the promise of help in the future, but what the tourist industry needs is immediate action. Here's what should happen without further delay…

The most pressing problem is cash-flow. To help those businesses which cannot pay their bills, the Government should set aside £500m of its large surplus to make available interest-free loans. This suggestion, which would be of real practical help, was first put to the prime minister by William Hague two weeks ago. He promised to look at it seriously, but nothing has happened.

Next, the Inland Revenue should be instructed to allow businesses to offset losses expected this year against tax due for last year earlier than they otherwise could. This will avoid the prospect of people being faced with a large tax demand in July, which they may find themselves unable to pay. The Inland Revenue has set up a helpline, but without further changes it will still be chasing businesses for money they have not got.

Many businesses are being forced to lay off employees but, in the tourism business, the need may arise at short notice to bring staff back in to work for special events. The rules governing the Jobseeker's Allowance are not sufficiently flexible to deal with these variations in demand, and the Government should ensure that the benefits arrangements allow for the current exceptional circumstances by letting work for a previous employer take precedence over any other work.

These measures would offer some welcome immediate relief to hard-pressed tourism businesses, helping to ensure that they will survive.

If the Government acts now, before it is too late, it will limit the damage; but, realistically, problems will outlive the disease itself.

Peter Ainsworth, Shadow Culture Secretary, House of Commons, London SW1.

I was appalled to read about the proposed Government loan scheme to assist small businesses (Caterer, 19 April, page 6) and the rate of interest that is apparently going to be applied.

Aside from echoing Mr Hague's view that the fund is inadequate, I cannot for one moment accept that this so-called assistance will attract an interest rate of 8.5%, which equates to 3% over the current UK base rate.

I would sincerely hope that none of Caterer's readers have a bank mortgage at this rate. Banks only apply an interest margin over cost to make money - that is their business after all - but the Government can have no justification whatsoever for applying any interest at all and should make these loans interest-free with a phased capital repayment once the affected business has returned to normal trading. All they are doing is lending the people the people's own money.

Pressure must be brought to bear to fight this outrageous proposal. I have today written to my MP, urging him to put pressure on the Government to rethink this penal proposal, and I urge all, affected or not, to do the same.

Hugh Caven, Managing Director, Walbrook Commercial Finance, By e-mail.

I think it's time to start utilising the industry's powerful networking system. After all, who can better appreciate what UK hoteliers are going through than their colleagues in North America - the small, independent, country hotel owners who have in recent years been as badly damaged by sensationalism in the media as by hurricanes, flooding and forest fires?

The Professional Association of Selected Hotels has been working hard to try to counter some of the misinformation. A small drop in the ocean, maybe, but one that we are confident will generate a multitude of ripples. Bearing in mind the size and nature of our 300 North American hotel members and the fact that their constant stream of guests more often than not spend time chatting with owners and staff - who better to pass on the word that Britain is still open for business?

Having mobilised our network, we're sending out regular bulletins to the hundreds of US innkeepers who have declared themselves only too happy to help and are already starting to pass on requests and booking enquiries from US travellers to our members here in the UK. The phones are slowly beginning to ring again.

Angela Jayson, Professional Association of Selected Hotels, London W1.

How should our industry respond to the foot-and-mouth crisis? The objective surely has to be to maximise sales at this, as at any other, time. To maximise sales, we need as many visitors as possible. If visitors are being put off because popular tourist destinations are closed, then perhaps hoteliers and restaurateurs should find out what is open around them, get together with those leisure destinations and agree to help promote each other's facilities.

Thus, a restaurant or hotel pursuing the tourist pound would be promoting not just its own facilities but also what is open around it for the tourist to see or visit. I am convinced that this would attract more visitors.

David Hunter, The Bowden Group, Marlow, Buckinghamshire.