'We're paying for the Government's mistakes' - frustration as hospitality forced to remain closed until May

By James McAllister

- Last updated on GMT

Frustration as hospitality forced to remain lockdown until May from Jeremy King Nutshell Restaurant Top Cuvee Exclusive Collection hotel group pubs

Related tags: Coronavirus, lockdown, Restaurant, Hotel, Pub, ukhospitality

Hospitality businesses have said they are 'paying the price for the Government's mistakes' after it was announced that much of the sector would remain closed until the middle of May.

Restaurateurs, publicans and trade bodies have all called on the Government to provide immediate clarity on issues related to the earlier reopening of outdoor settings, and potential limits on indoor capacity as and when hospitality venues can reopen for dine-in guests. 

With much of the sector facing around another three months of closure, further pressure is also falling on Chancellor Rishi Sunak to come out this week and deliver a substantial package of financial support to see hospitality businesses through the protracted closure, rather than wait until next week's Budget.

Yesterday (22 February) Prime Minister Boris Johnson set out his roadmap for easing lockdown restrictions in England​.

He confirmed that restaurants, pubs, hotels and B&Bs will be able to reopen for dine-in guests from 17 May 'at the earliest' under a four-stage plan for lifting restrictions in England.

As had been rumoured, outdoor hospitality settings including pub beer gardens will be able to reopen earlier than indoor ones and are scheduled to unlock from 12 April.

The final stage of the plan, on 21 June, will see night-time economy businesses, such as nightclubs, finally allowed to reopen after more than a year a closure.

All legal limits on mixing are expected to be removed at this time.

Johnson said his roadmap is designed to guide the country 'cautiously but irreversibly' out of lockdown, with each stage of the plan separated by a five-week gap to gauge how the easing impacts transmission levels.

Immense frustration

While there is an obvious relief at there finally being a plan for reopening in place, much of the sector has been left immensely frustrated at having to wait so long before it can unlock.

"Unfortunately, the business are paying the price for the never ending chain of mistakes made by this rather incompetent, populist government," says Mohammad Paknejad, co-founder of Iranian restaurant Nutshell in London's Covent Garden.

"The Government refuses to accept the effects of the spread of the virus amongst school children at schools even though they themselves publish studies showing the highest infection rates are between school children. It doesn’t really come across as if the Government knows what they are doing or if they have ever had a plan.

"[Yesterday's announcement] should have been followed by another speech or at least a press release from the Treasury informing businesses on how they will be supported during the rest of this extremely long period of mandated closures.

"Now, the only thing that businesses know is that they won’t be having any revenue anytime soon. Thus, a lot of businesses might resort to laying off more staff or closing their premises until the Government scrambles for another pathetic attempt at supporting economy."

Corbin & King co-founder Jeremy King has accused Boris Johnson of 'gambling with the health of the hospitality sector'.

Writing in the Daily Mail​, he said: "[The Prime Minister] cannot know how many of these business will ever reopen.

"I can tell him bluntly: significant numbers of the businesses currently drawing down furlough money will never actually reopen because they are holed below the financial waterline."

King added that he has worked to keep his 600-strong furlough workforce informed of when they can expect to return to their jobs and normal life. 

He said many of them are struggling with their mental health and beginning to despair, with the loss of income leaving some facing eviction from their homes.

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Corbin & King restaurant Soutine in St John's Wood

"Yesterday evening I had to sit down to compose one of my regular emails to update [my team] on the implications of the Prime Minister’s announcement," he said.

"I found it very difficult, because the Government’s position is literally inexplicable and illogical.

"Those of us who work in an industry that before Covid employed some three million people, generating revenues of some £72bn a year, are offered no proper explanation of how these decisions are reached.

"Nor are we properly consulted, or asked for our input.

"Such arrogance led to the imposition of the ridiculous curfew in pubs and restaurants last year, which actually increased the infection risk as it led to the mass ejection of customers at 10pm and a subsequent rush to public transport.

"We restaurateurs, innkeepers, club operators, and café owners generate billions of pounds of tax receipts in payroll taxes, VAT and profits, and yet – frankly – are treated with utter contempt."

Businesses on the brink

Across the sector there are fears that forcing businesses to remain closed until May will lead to a significant amount of business failures across the sector, with or without further support from the Government.

“It’s hugely disappointing that once again hospitality is last in the queue to reopening, despite the enormous efforts made to provide safe and secure environments and the lack of evidence of hospitality driving transmission rates," said Danny Pecorelli, managing director of luxury hotel operator Exclusive Collection.

"We are going to lose so many more amazing restaurants, pubs, cafes and hotels even if the Chancellor does pull all the stops out during the Budget. Three more months of being unable to fully trade will be the final straw for many.“

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High-profile restaurateur David Moore, who owns fine-dining institution Pied à Terre on Charlotte Street in London's Fitzrovia, said that while he was glad to have a reopening date to work towards, he was still perplexed that the hospitality sector was taking a thrashing from the Government despite not being a proven vector for Coronavirus transmission.

He also warned of the closures and insolvencies to come.

"This confirmed date means we are going to see a number of restaurants who will not survive in the upcoming weeks," he said.

"They haven’t got the money to keep going and banks are refusing to give out loans. We have already lost many of our neighbours on the streets; there have been four closures on Charlotte Street alone, and yet I fear the hospitality casualties have not even started to peak.”

A need for clarity and support

There have also been calls for the Government to provide immediate clarity on issues related to the earlier reopening of outdoor settings, and any potential limits on indoor capacity when hospitality venues can reopen for dine-in guests.

Johnson confirmed that when indoor hospitality settings do reopen they will initially be subject to social contact rules including the 'rule of six'.

"We're happy people can serve outside, but how does that affect restaurants like ours with no outdoor capacity," questions Brodie Meah, co-founder of lively neighbourhood-style restaurant Top Cuvée in London's Highbury.

"Same thing with reopening indoors, [the Prime Minister] mentioned capacity limits. What will they be?

"We need more details to help plan."

Kate Nicholls, chief executive of trade body UKHospitality, said it was now imperative the Government provided a major package of financial support to help hospitality survive.

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She said: “This delay in reopening will make the job of survival all the more difficult for businesses only just clinging onto existence. It is much more than just an inconvenience for many employers in our sector, it is another delay that they cannot afford and, for too many, will not be able to survive.

“When we can open, our businesses are going to be facing severe restrictions. Only 40% of hospitality businesses have an outdoor area and, in some cases, this is little more than a table and a couple of chairs. Outdoor only opening initially just does not work for huge numbers of businesses. Enforcing table service [and social contact rules] will see businesses trading below sustainable levels.

“The job for the Government now is to make sure that our sector survives this further period of closure intact. 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 reopen.

Nicholls has stated that in the immediate term the sector needs a generous compensation package that goes beyond what was offered in January with a commitment to eliminate new costs that are due to hit such as HMRC tax bills and loan repayments.

"An extension of the VAT cut and business rates holiday must be confirmed along with a targeted extension of the furlough scheme," she continued.

"We must also have an extension of the rent moratorium, with loan repayments and HMRC debt delayed in order to give businesses some breathing room from the ruinous mountain of debt that has built up for too many.

"Asking businesses to start paying this money back when they are not even open could be terminal for many.”

Hope on the horizon

Despite the frustration from businesses, there's also a sense of optimism from some in the sector that hasn't been seen in months.

"We are at last feeling really positive about our route out of lockdown," says Nick Bannister, managing director of The Coniston Hotel in Skipton. 

"We are delighted with the detail on dates, which was more comprehensive than anticipated, and the fact that we can now reassure both our customers and our team and can really start to plan for the different stages of our reopening.

"Today we are feeling optimistic and hopeful for hospitality and excited for the future for The Coniston, our customers and our communities.”

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Bannister's positivity is echoed by Daniel Farrow, who owns The Gatherers restaurant in Norwich and recently upgraded his site's beer garden in expectation of the summer trade.

"The news of beer gardens reopening is a great victory for those with the space to trade outside and is going to be absolutely amazing for us here at The Gatherers," he said.

"I've recently been renovating our gorgeous beer garden and it's going to be so stunning for our reopening. We plan on serving burgers, hot dogs and potentially pizzas from a barbecue set up in the garden and will have our ever extensive range of exceptional cocktails, chilled beers and stunning wines for everyone to enjoy in the beautiful spring sunshine.

"I can't wait to see all of our incredible, loyal customers again and look forward too seeing new faces too.

"This is great news and hopefully just the beginning of the healing process for the hospitality economy.”

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