There is to be an additional £1,000 grant for ‘wet-led pubs’ in tiers 2 and 3 who will miss out on business in the run up to Christmas because of the tighter restrictions on opening
The payment will be a one-off for December and will be paid on top on the existing £3,000 monthly cash grants for businesses.
The government said this will cover those in tiers 2 and 3 forced to reduce their operations as a result of the latest regional measures put in place to contain transmission of the virus.
Under the new rules which come into effect today, in those areas placed in tier 2, hospitality venues will be allowed to stay open until 11pm, with last orders at 10pm.
However, only pubs that serve ‘substantial meals’ can operate, or will have to close. The government has since clarified that this could include offering drinkers items such as Scotch eggs or pasties.
In addition social mixing outside of households or support bubbles is not be allowed indoors, which means groups of customers from different households should not be drinking together. The rule of six applies outdoors.
In tier 3 areas, which includes large parts of the north east of England, hospitality venues are shut from today, except for delivery and takeaway services.
The tier system will be reviewed every fortnight with the first review on 16 December.
Prime Minister Boris Johnson said: ‘While we can’t make up for all the trade they will lose over Christmas, I hope this new £1000 grant – on top of the furlough, VAT and business rates relief and existing grants, goes some way to help them weather the economic storm.’
Eligible wet-led pubs across tiers 2 and 3 are invited to apply through their local authority who will be responsible for distributing the grants. The payment will be made once per business for the month of December only.
Trade body UKHospitality said its analysis suggests the new restrictions will see 98% of the hospitality sector in either tier 2 (77%) or tier 3 (21%). It warns this will result in a drop in trade for the whole of December of £7.8bn, or 70% of revenue compared to last year.
Kate Nicholls, chief executive of UKHospitality, 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.
‘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.’
UKHospitality is calling on the government to offer a targeted replacement of the job retention bonus (JRB) which was cancelled when the furlough scheme was extended to March next year.
Secondly, it is looking for an extension of the rent debt moratoria to the end of June 2021, in order to prevent landlords from evicting hospitality businesses and issuing winding up orders.
Its third recommendation is based on the model adopted in similar European countries who are having equivalent restrictions by compensating business for a loss of trade. This could amount to a proportion of the drop in sales compared to verified accounts in 2019.
Alongside this immediate support, UKHospitality is also calling for an extension of the current VAT cut as well as a business rates holiday for the whole of 2021 to enable businesses to rebound next year.