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Hospitality Lobby Warns of £7.8 Billion National Wipeout in December

U.K. Hospitality again asserts that tier restrictions that allow opening but restrict trade need proportionate support

Deserted Soho restaurants Peter Summers/Getty Images

Restaurants, pubs, bars, and cafes in London now know that they will enter tier two coronavirus restrictions from 2 December, until at least 16 December and potentially into spring 2021. U.K. Hospitality, the trade body for these businesses, has warned that the cumulative impact of coronavirus restrictions nationally — including businesses in tier three — will be a £7.8 billion turnover deficit compared to December 2019.

Chief executive Kate Nicholls said: “The new tiers will see over 120,000 venues across England placed into Tier 2, with tens of thousands of these forced to close as they are unable to provide a table meal, either physically or financially. This affects the employment of nearly 1.5 million people. Under this severe a restriction, 94 percent of our members say they will be unviable or trading at a loss.

“It is now more vital than ever that the government provides urgent further financial support for this sector. If it does not, we are looking at huge numbers of job losses, businesses permanently closed and the landscape of hospitality in this country fundamentally degraded for the foreseeable future.”

As with the previous tier system introduced in October, tier two restrictions allow restaurants and pubs to open while limiting trade by restricting household mixing. This means revenue will drop, but businesses are not eligible to claim additional financial support from the government — because they are open. With the furlough scheme extended to March 2021, that option is available, but with the expiration of the lease forfeiture moratorium currently 31 December 2020, the vast majority of restaurants’ upcoming costs cannot be met by that scheme. Nicholls once again highlighted the need for a rent solution, saying that the government must “extend the rent moratoria and broker a solution to tackle the issue of rent debt that has built up.” The government has repeatedly shown that it is unwilling to meddle in this commercial bargain. Sooner or later, it will either have to meddle or watch as thousands of hospitality businesses are forced to close.

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