Trade bodies call on government to secure future of British hospitality and supply chain

04 November 2020 by
Trade bodies call on government to secure future of British hospitality and supply chain

Trade bodies representing the UK's hospitality, pubs and their supply chain businesses have called on the government to provide a six-month investment plan to secure the future of those sectors.

In a letter to the chancellor, UKHospitality, the British Beer and Pub Association (BBPA), British Institute of Innkeeping (BII), Campaign for Real Ale (Camra), Society of Independent Brewers (SIBA) and Pub is the Hub have outlined details of the necessary support plan.

Without this support, the letter states, many viable businesses will fail, with significant job losses, impacting the long-term prospects of the UK's economy.

The letter calls for:

  • Employment support guaranteeing 80% of wages to continue for businesses beyond the national lockdown, with flexible support available throughout the next six-months;
  • A more sustainable round of grants in line with the first lockdown to adequately cover ongoing fixed costs, with payment as soon as possible. This must allow access to the full state aid allowance of €3m (£2.71m) per business – and potentially more once the UK is no longer subject to EU rules;
  • An extension to the rent enforcement moratorium to June 2021 to protect businesses and bring partners to the table;
  • A reduced rate of VAT for hospitality through the whole of 2021 and a business rates holiday for 2021/22;
  • Investment in British brewing via beer duty support and a compensation scheme for brewers for unsold beer and returned stock.

In a joint statement, the trade bodies said: "Hospitality businesses and pubs were the first hit by this crisis, and they have been the hardest hit. They have existed through nine months of forced closures or severe restrictions. The government has recognised the unique challenges facing our sector and we are grateful of the support it has provided.

"It is not enough, though. Our sector has been hit with job losses and venue closures, with the pain being felt across the entire breadth of the industry down to supply chain businesses which are also suffering.

"We are still on a knife-edge. Over 90% of fully Covid-secure, hospitality and pub businesses are operating at a loss, thousands of otherwise viable businesses in Tier 3 and Tier 2 areas had already closed. Debt continues to build to unsustainable levels and turnover is at a fraction of normal trading. We are entering this next phase of national lockdown in a critically vulnerable position.

"It is crucial that the government provides long-term financial support that goes well beyond what has already been announced. These are viable businesses that, if kept secure, can lead the revival of the economy in 2021. It is a sector that, prior to Covid, directly provided 3.2 million jobs across every part of the UK, and a further one million in dependent supply chains, with vital economic and social hubs in every region.

"By every conceivable measure, it makes sense for the government to support hospitality and pub businesses as well as their supply chain partners. We can be in the vanguard of economic recovery next year, driving growth, creating jobs and providing billions in vital tax revenues into the future, but only if we survive this perilous moment."

Pictured: Kate Nicholls of UKHospitality

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