What does a second lockdown mean for hospitality?

Hospitality closed sign

On Saturday (31 October), Prime Minister Boris Johnson announced that England will move into a second national lockdown, confirming that all hospitality businesses will have to close from Thursday.

The month-long lockdown comes into force at 12.01am on Thursday 5 November and will last until 2 December. There is, however, a possibility of it being extended.

Venues will need to close their doors on Wednesday night at 10pm, in line with the current curfew.

As before, throughout the lockdown, businesses will be able to operate a takeaway and delivery services. Takeaway alcohol was not permitted when the lockdown was first announced. However, since then, the government has made a partial U-turn on this rule, now stating that consumers can purchase drinks to take out if they are pre-ordered.

but this time alcohol will not be allowed – a rule that has seen a great deal of confusion and backlash from the on-trade.

Chancellor Rishi Sunak has also announced the extension of the furlough scheme. Details can be found on the government website, along with other Covid-19  information and support.

Hospitality trade bodies UKHospitality and the British Beer & Pub Association (BBPA) have said that further government support is needed to help businesses.

Kate Nicholls, UKHospitality’s chief executive, said: “Public health objectives are, rightly, the motive for the new measures, and for that reason we entirely support whatever proportionate action is necessary.

“The costs to hospitality businesses of a second lockdown will be even heavier than the first, coming after periods of forced closure, the accumulation of mass debt and then significantly lower trading due to the restrictions of recent weeks.

“The sector was hit hardest and first, and this recent shutdown will hurt for months and years to come. The extension of furlough for a further month does help to protect our workforce during this difficult time.

“If hospitality, the sector that is our country’s third largest employer, is to survive and help drive economic recovery, it will need equivalent – or more – support than that of the first lockdown.

“Hospitality businesses have already been pushed to the limits, with many closures already. For those that have survived, viability is on a knife edge, as is the future of the tens of thousands of businesses and hundreds of thousands of jobs that depend on hospitality, including through its supply chain, right across the country.

“It is critical that businesses are given a lifeline to survive the winter, before being given the support to enter a revival phase in 2021, as the nation’s prospects improve. A clear roadmap out of lockdown and through the tiers will also be vital for businesses to plan their survival, and the safeguarding of hundreds of thousands of jobs.

“It is important to remember that some parts of hospitality, such as nightclubs, have not even been allowed to re-open. The support for those, now that potential reopening has been kicked further into the future, must be redoubled to ensure that they are not lost forever.”

The trade association has said the 28-day lockdown will result in thousands of pubs and many of the breweries that support them being lost, unless the Government urgently provides the sector the same, if not greater, levels of support than it did for the first lockdown.

Emma McClarkin, chief executive of the British Beer & Pub Association, said: “As a sector, we are of course devastated to have to close our pubs and are fearful for their future, but we recognise the situation and that the spread of Covid-19 is serious.

“Make no mistake, this could be the final straw for thousands of pubs and brewers. It will also create major disruption to our supply chain partners whose businesses are now also at severe risk.

“The level of financial support will need to be same, if not greater, than that provided for the first lockdown earlier this year. This means grants for ALL pubs sufficient to cover ongoing fixed costs, and compensation grants for Britain’s brewers who will also be permanently devastated by the lockdown.

“The news of the extension of the full furlough scheme for this lockdown period is welcome, but we await the full detail of it, and will need a full support plan far beyond the lockdown period to save our great British pubs and brewers.

“A clear, early signal on an economic stimulus package from April next year is a vital element of this. This includes extending the business rates holiday and the hospitality VAT cut, and support on beer duty.

“As ever, we stand ready to work with government on such a plan. We served our communities well throughout the first lockdown, and we want to continue to serve communities across the United Kingdom through this closure and for many years to come.

“Support from the government, with investment in the pub and brewing sector, will reap rewards economically and socially. Only such support will ensure that we can come together once more to enjoy the warm welcome of the great British pub with a great British pint, once this crisis has passed.”

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