Trade bodies warn roadmap jeopardises hospitality survival without further support

By James McAllister

- Last updated on GMT

 Trade bodies warn roadmap jeopardises hospitality survival without further support

Related tags: Trade bodies, Hospitality, Coronavirus, lockdown, Government, Chancellor, Budget

Hospitality trade bodies have written to the Chancellor warning that, unless a substantial package of support is announced at the Budget, businesses will fail before they're able to reopen.

The joint letter, penned by UKHospitality, the British Beer and Pub Association (BBPA) and the British Institute of Innkeeping (BII) and signed by more than 200 business leaders from across the sector, further reaffirms the dire position of many businesses and the urgent need for financial support.

It comes ahead of the Chancellor's March Budget, which he will deliver next week.

The letter warns that, with businesses are spending an average of £10,000 per month to remain closed, one in five will not have enough cash to survive the rest of February.

Additionally, nearly two-thirds of businesses do not have enough cash to survive until the end of May.

It is hope that, following the announcement of the Prime Minister's roadmap out of lockdown​ earlier this week, restaurants and pubs will be able to reopen for indoor service in mid May, but will initially still be subject to social contact rules such as the 'rule of six'.

The letter adds that these ongoing restrictions will leave businesses unable to breakeven until the prospective lifting of all distancing measures on 21 June.

In order to help businesses bridge the gap, the letter calls on the Chancellor to unveil an urgent package of support at the Budget that includes previous demands such as an extension to the VAT cut and business rates holiday; and an extension of full furlough with no National Insurance contributions for closed businesses.

Additionally, the trade bodies ask for enhanced grants for hospitality businesses until 21 June, with State Aid rules disapplied; a beer duty cut; and no repayment of HMRC debts before 1 July.

An extension of the lease forfeiture moratorium is also called for, along with a demand that Government and stakeholders work together to find a solution to the rent debt crisis​.

In a joint statement, the trade bodies said: “This week’s announcement of the plan for reopening the economy has sent shock waves through the nation’s hospitality businesses.

“There is a genuine fear amongst many in our sector that businesses are going to fail and jobs will be lost at the eleventh hour.

“After a year of misery, the end is now finally in sight. The Government cannot allow business to fail now, when the reopening of our sector is within touching distance.

"Members of the public are desperately looking forward to socialising with their friends and family, for the first time in over a year in many cases. If the Government does not act, they may not be able to.”

Related topics: Business

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