Hospitality chiefs welcome £1bn Omicron support package — but warn more help needed if curbs tighten

ospitality and leisure industry leaders have welcomed the Chancellor‘s newly-announced £1 billion emergency support package, but have cautioned more help may be needed.

Rishi Sunak today unveiled measures to assist consumer-facing businesses hit hardest by the pre-Christmas collapse in trade caused by the surge in Omicron.

Eligible businesses will be able to apply for one-off grants of up to £6,000 per premises as part of a package of support which also includes more money to help smaller firms cover the costs of statutory sick pay.

Business leaders had been clamouring for Government support over the past week, after Plan B’s work from home order and wariness over catching the highly-transmissable variant before Christmas saw bookings devasted in two of the sector’s crucial trading weeks of the year.

Many central London pubs, restaurants and gyms had already closed early.

Hospitality businesses in the area had seen a 70% drop in revenues — double the levels in the rest of the country.

Kate Nicholls, CEO of trade body UK Hospitality, said the package is “generous” and will “help to secure jobs and business viability in the short term, particularly among small businesses in the sector”.

Supply chain businesses will be key beneficiaries, she said.

Emma McClarkin, CEO of the British Beer and Pub Association, said the support package will be “a vital lifeline for many”.

But she cautioned: “It will be absolutely essential that the Government continues to monitor and support our sector for the long-term as we ride out the pandemic and into recovery.

“Ensuring our pubs and brewers continue to have the support they need, including further financial support if further restrictions are introduced, along with a clear timeline for the lifting any such measures.”

Shevaun Haviland, director general of the British Chambers of Commerce, said the grants must reach businesses quickly. (There were widespread reports that support grants were slow to reach business owners in the January lockdown last year, as cash sat with local councils for long periods).

Haviland said: “Whilst these measures are a positive starting point, if restrictions persist or are tightened further, then we would need to see a wider support package, equal to the scale of any new measures, put in place.”

Some business owners criticised the package as offering too little support for the current situation, however.

Sacha Lord, co-founder of Machester’s Warehouse Project, said: “This package is a disgrace and offensive.”

Lord said the support is “nowhere near enough to save the industry”, adding: “How can businesses that expected to take up to 30% of their annual revenues during December survive on £6,000 grants?”

London restaurateurs were more measured in their responses. Lawrence Hartley, co-owner of Joe Allen, told the Standard: “Last week we had over 1500 covers cancel, this week we’ve had 750 so far and there are still two days left of trading before Christmas. We’re looking at around £150k in lost revenue.

“Although it’s good to have a tiny bit of relief, it’s not Christmas by any stretch of the imagination and without additional support it won’t cut it I’m afraid, December is where we need plenty of trade to store our nuts! What we need is clear direction — the mixed messages from the government is the equivalent of purgatory. We feel we have to keep open if we can for the little demand we have (and some trade is better than nothing), we certainly can’t afford to close with the overheads we have and are desperate for some cash flow and a sensible solution that preferably includes extended rates and VAT relief.”

James Chiavarini, owner of Kensington’s Il Portico and Pino, was more sanguine, saying: “To be honest, I’ll bite their hand off. It will recuperate maybe 10% of our losses, but it’s a hell of a lot better then a kick up the bum.”

London restaurant consultant Craig Melvin added: “Only a very small London pub would find the £6,000 any use at atll and even then, it would only cover their lost profit for one week.”

Gary Usher, owner of Elite Bistros, who operate sites across the north, tweeted: “The chancellor’s bail out package isn’t adequate for a lot of businesses (most hospitality businesses in-fact) but it’s a start. And it’s a lot more than was available yesterday, which was nothing.”

Business groups are also asking for longer term measures such as extending the 12.5% VAT rate for hospitality beyond next April, business rates relief, a moratorium on evictions, and the reintroduction of a flexi-furlough scheme.