UK: Following news that supermarket Tesco will repay £585m of grant support to the government, trade body UKHospitality is calling for the creation of a Hospitality and Tourism Recovery Fund and warns of a “bloodbath” as December’s rent date looms.
UKHospitality chief executive Kate Nicholls said: “It is an admirable and altruistic gesture from a company that is clearly in a much better financial situation than the vast majority of those in hospitality. The question now is what happens to this money, which the government had intended to invest in supporting businesses.
“We are calling on the government to earmark that money, to create a fund for those hospitality and tourism businesses that are at high risk of failure, have been closed since March or that have had no grant support, similar to the Cultural Recovery Fund. A hospitality and tourism recovery fund, including rent support to preserve the future of our high streets, would deliver a huge boost to businesses that are only just clinging onto life right when they need it most.”
With the lease forfeiture and debt enforcement moratoria due to come to an end on 31st December, businesses are under threat from further closures and job losses.
There is an estimated £1.6 billion in unsettled rent within hospitality. The debt burden from unpaid rent and bills as a result of suppressed sales could trigger “a new year bloodbath of hospitality business failures” unless the government steps in. UKHospitality is therefore calling for an extension of the moratoria to the end of June 2021.
Nicholls said: “There can be no more excuses about parliamentary time or available finance; this needs to be resolved, otherwise the support government has provided to the sector so far this year will all be in vain. The alternative is widespread business collapse and shocking job losses on an almost unthinkable scale. Unless this issue is resolved, there will be a bloodbath on our high streets and a much longer-term damaging impact on the UK economy.”
On 2 December 2020, most of England was moved into the two toughest levels of restrictions, with some areas remaining in full lockdown.
Several hospitality leaders expressed their concerns. Tony Matharu, chief executive of Blue Orchid Hotels, said:“Government must urgently set out with absolute clarity the support that businesses will be receiving up until Q2 2021. Businesses do not want support – they absolutely need it, because of the lack of footfall and demand as a direct consequence of the pandemic and the Government’s response to it.”
Tom Aikens, chef, said: “We should be given our full licence to run our venues and make as much revenue as we can – this year has been hard enough and the job losses catastrophic. This scaremongering has to stop – it’s turning customers away. Let us operate fully and help build up the economy again. It’s tough for small businesses as it is. Pubs and publicans, well they’re really not going to have a happy Christmas.”
