Boris Johnson’s New £1,000 Grant Isn’t Going to Save Any Pubs

Prime Minister Boris Johnson today told MPs that “wet” pubs will receive a one-off payment of £1,000 in recognition of their being closed under tier two and tier three coronavirus restrictions. For clarity, a “wet” pub is one that serves drinks, but does not serve substantial meals. This will amount to less than a night’s profit for the great majority of pubs in London.

Johnson announced the measure during a debate on the new restrictions in the House of Commons, due to come into force tomorrow, Wednesday 2 December. He said that the grant for qualifying boozers was a bid to “recognise how hard they have been hit,” and also said that the hospitality industry had borne a “disproportionate share” of the burden when it came to imposing public health restrictions on England.

Labour leader Keir Starmer called the plan “small beer.”

Beat.

Pubs themselves are also not pleased. British Beer & Pub Association (BPA) chief executive Emma McClarkin told Propel that it was “nowhere near enough,” not just for pubs but for the supply chains that depend on them. Last week, the BPA wrote to the government with a grant programme of its own, which would have ranged from £3,000 — £12,000 per month, dependent on the rateable value of each business, The government will point to its being additional to further grants — up to £3,000 for closed businesses and up to £2,100 for those with “significantly reduced footfall” — and also to its attempts to let pubs stay open by “operating as restaurants” and not serving Scotch eggs.

What really lies behind the grant’s inadequacy is the need to deliver piecemeal solutions to failures in reactive policymaking, that are more about symbolism than economics. It is credulous that the government did not know pubs that couldn’t serve food were “hard hit” when it announced the terms of tiers two and three in November. They’ve been “hard hit” since March. And however derisory the figure announced today may be, there would have been a little more understanding if the closure and the grant had been announced together.

But throughout the crisis, the Conservative government has been trying to avoid proactive policies that would prove unpopular for being sweeping and/or draconian, even if they would have been significantly more effective than the half-measures and reactive amendments which are designed to offer an illusion of permissiveness and freedom, but economically leave businesses staring down the barrel.

Closing pubs down unilaterally with proportionate financial support would unarguably be more epidemiologically effective than closing some pubs down dependent on their food offering and giving the ones without food a £1,000 cheque that doesn’t touch the sides, but Johnson and his government have been trying to avoid this proactivity from the very beginning. The link between the small grants, the “substantial meals,” and the coronavirus tiers is the political tension between public opinion barometer Johnson and public spending tallier Rishi Sunak, which has manifested in policies that allow pubs to be open, while severely restricting their trade through curfews, household mixing bans, and other necessary public health measures. All of those measures would be achieved by ordering them to shut, but then the government would have to pay them money.

Pubs aren’t allowed to open if they serve substantial meals because the government loves debating the ontology of Scotch eggs; they’re allowed to open to limit government expenditure on grants for businesses forced to close by COVID-19 for Sunak and allow Johnson to say “look, you can go to the pub!” The exception to this parsimonious push-pull was the Eat Out to Help Out scheme, which both probably contributed to a rise in coronavirus cases and cost, according to HMRC data from November, around £849 million. It had also, by September, reportedly gained the Treasury around £250 million in furlough scheme savings and tax.

Furthermore, the prime minister’s refrain for national lockdown 1.0, tier system 1.0, national lockdown 2.0, and tier system 2.0 has always been the same: a paraphrasing of the sentiment that no Prime Minister wants to make these decisions; no Prime Minister wants to impose these restrictions. That’s why each new plan is billed as “not another lockdown.” Until, of course, there is another lockdown.

And in the gap between the political abstractions — “substantial meals” being one — and the concrete converting of those into legible policy, sit thousands of real life pubs, whose takings, employment, and future are all impacted by the abstraction and half-baked policy well before the government converts them into law or adds on these financial measures. This is even more true for brewers, whose vulnerability comes directly from being attached to the supply chain.

With the proactive, unpopular strategy off the table, what replaces it is a reactive risk management, which applies piecemeal plasters to gaping wounds in the hospitality sector. Pub bodies said their sector was losing £100 million a week as early as June. And until vaccines are rolled out at scale, this cycle of announcing restrictions and then announcing inadequate financial responses to those restrictions will likely continue. Pint, anyone?