A one-off grant of £1,000 for wet-led pubs forced to close because of coronavirus has been criticised for not doing enough to support pubs through winter.
Pubs in tier 2 and 3 restrictions will be provided with the support if they are unable to open due to government restrictions, the prime minister announced.
Boris Johnson announced the grant at the start of a debate on the new tiered system which will come into force overnight.
The PM said the payment for December would come on top of the £3,000 per month for businesses forced to close.
He said: “We will do everything in our power to support our hospitality sector throughout this crisis.”
He said the payment recognised “how hard they’ve been hit in what is typically they’re busiest month”.
Around 16,010 pubs will be in England’s tier 2 from Wednesday, according to analysis by real estate adviser Altus Group, meaning they will be banned from opening, except for takeaway and delivery services.
Simon Emeny, CEO of Fuller’s, said the one-off payment will not be enough to save many wet-led pubs.
“A thousand pounds really doesn’t really go any way to solving the financial Armageddon that many individual and independent operators are going to face,” he told the BBC.
“The challenge for wet-led pubs is if they don’t sell food they will find it impossible to operate, but you have still got bills to pay.
“They have still got to pay potentially rent, insurance costs, national insurance and the apprenticeship levy. That is far more than £1,000.”
Nick Mackenzie, CEO of Greene King, said: “Today’s announcement of the £40m support fund for wet-led pubs only equates to around £1,000 per pub – which simply isn’t enough and won’t touch the sides of the financial hole that’s left for pubs over what is traditionally the busiest trading period of the year. Because of the new tier structure, many pubs are unviable with heavily reduced revenue and significant costs from reopening and closing as the rules constantly change.
“Jobs and livelihoods are at risk. Unless the government urgently reviews the restrictions, many pubs face permanent closure, which will deprive communities across the country of their much-loved great British pub.”
UKHospitality said the payment fell “far short” of what was required to avoid “catastrophic failures and widespread job losses”.
UKH said the new restrictions which will see 98% of the hospitality sector in either tier 2 (77%) or 3 (21%), leading to a drop in trade for the whole of December of £7.8bn – 70% of revenue compared to last year - if left unamended.
CEO Kate Nicholls said: “A one-off payment of £1,000 for pubs forced to close does not even count as a token gesture. Equivalent to just 1.1% of last year’s takings, it falls far short of the bare minimum required to keep these businesses alive.
“The Government’s entire approach to this lacked any sliver of logic, as evidenced by the farcical debate around Scotch eggs over the past 24 hours. There needs to be a much clearer and supportive approach from the Government and this means providing far more support immediately.
“The new tier system condemns 9 out of 10 hospitality businesses to being unviable by the New Year. This is not just a threat to community wet led pubs but also neighbourhood restaurants independent hotels, nightclubs and other hospitality venues who are now staring failure in the face. The sector will lose £8bn of revenue in December and bear £0.3bn of costs of closure and restricted trading.
“The Government’s own figures say a third of businesses are at risk of insolvency. This jeopardises over a million jobs and threatens collapse across the supply chain.
“The Prime Minister himself said that he was asking hospitality to bear a disproportionate burden to allow the reopening of all other parts of the economy and pay for our festive bubbles but the compensation is derisory. It is vital that they bring forward a more comprehensive package of emergency and long-term support to stave off the collapse of the 3rd largest sector and export earner - a sector vital to our economic recovery.”
Pub grant ‘not enough’
A one-off grant of £1,000 for wet-led pubs forced to close because of coronavirus has been criticised for not doing enough to support pubs through winter. Pubs in tier 2 and 3 restrictions will be provided with the support if they are unable to open due to government restrictions, the prime minister announced. Boris Johnson announced the grant at the start of a debate on the new tiered system which will come into force overnight. Simon Emeny, CEO of Fuller’s, said the payment will not be enough to save many wet-led pubs from the “financial Armageddon” that many operators are facing.