Government Warned-Hospitality & Pub Sector ‘Lost In Days’ Without Action

The UK’s pub industry will be “lost in days” without immediate and decisive Government action, its leaders warned.

In a letter to the Prime Minister, the British Beer and Pub Association said it was facing an existential crisis as a direct result of Boris Johnson’s new guidance that people should avoid visiting pubs, restaurants and bars.

It called on the Government to take urgent action to prevent thousands of pubs from closing and hundreds of thousands of job losses.

Emma McClarkin, chief executive of British Beer and Pub Association, said: “Forced pub closures without a meaningful support package will have a catastrophic financial and social impact.” The severity of the COVID-19 crisis is now impacting on Pubs with devastating effect. The very existence of thousands of pubs and a lot more jobs is now at risk.

“The government needs to give clear instructions and detail on the support package to rescue the sector and hundreds of thousands of jobs.

“Urgent measures to support cash flows and enable cost reductions is an absolute necessity. Government action now will save thousands of jobs and save our pubs.

“Support for pubs now is an investment in the long-term future of communities across the UK without it we risk losing our community assets forever.”

Ms Larkin say “We would ask that the Government takes the following actions immediately as a matter of urgency in order to prevent mass job losses and permanent pub closures”:

  • The cancellation of all business rates payments for a period of six months, as well as all HMRC tax payments, including PAYE, VAT and corporation tax for pubs/hospitality businesses
  • Cancellation of beer duty payments for a period of six months
  • Ensure banks are encouraged to extend credit lines and favourable-terms loan payment holidays to keep businesses afloat/pay wages
  • Put in place a temporary redundancy scheme in which, as in the Danish system, the Government commits to supporting 75% of the wages of those made redundant for a defined period
  • In the medium term, explore the viability of a substantial VAT cut for a period of time in order to drive trade back to the hospitality sector
  • Postponement of the planned National Minimum Wage/National Living Wage increase due in April in order to ease pressure on cash-flows

Adding “I cannot emphasize strongly enough how critical it is that action is taken now. Failure to do so will destroy the industry and measures taken to support these businesses should be seen as an investment in securing the future of urban and rural communities across the country as the British Pub remains at the heart of social cohesion.”

Kate Nicholls, chief executive of UK Hospitality, said the government guidance announced last night is “catastrophic for businesses and jobs”.

“Over the past few weeks the industry has suffered unprecedented drops in visits and many business are already on their knees,” she said.

“This latest advice leaves the industry in limbo, with no recourse to insurance.

“The government must act now to stop them going under and protect the people’s jobs. These venues play a unique role as community hubs and it’s in all our interests to protect and preserve them so they are still there once we emerge from this crisis.

“We need immediate and far-reaching support from the government, and meaningful business continuity measures.”

Mark Jones chief executive of Italian restaurant group Carluccio’s said that the restaurant chain “was days away from large-scale closures” without state aid.

Speaking to the Today programme, he called for “immediate” help for the industry from the chancellor.

With consumers increasingly working from home amid the coronavirus pandemic, the restaurants have already seen footfall declining “on a daily basis”, he said. : “We understand the role we have to play in public health, so I won’t question the government’s advice on that. But to do that to an industry without any fiscal support whatsoever condemns us to death, effectively.”

He added that the government restrictions announced last night meant “we’ll be in a situation where sales start to decline even more rapidly from today onwards”.