Plan put forward to save UK's battered hospitality industry from oblivion

A leading business group has urged the Chancellor to implement a radical £35bn set of measures to safeguard 500,000 jobs and save Britain’s ailing pubs, restaurants and local high streets from financial “oblivion”.
Evoque in Preston closed permanently in NovemberEvoque in Preston closed permanently in November
Evoque in Preston closed permanently in November

The move follows successive lockdowns and a pre-existing decline in footfall.

The economic collapse in Britain’s hospitality sector – responsible for over three million jobs – accounts for roughly one-third of the overall slump in GDP.

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To provide urgently needed financial support for the hospitality and high street economies, the Independent Business Network (IBN), which champions the needs of family-run and family-owned businesses across the UK, has called on the Government to implement a swathe of measures, including halving the amount hospitality venues pay in alcohol duty and extending the suspension of business rates for a further 12 months.

Dominic Leighton of the Three Mariners in Lancaster, which has been closed for months because of Government restrictionsDominic Leighton of the Three Mariners in Lancaster, which has been closed for months because of Government restrictions
Dominic Leighton of the Three Mariners in Lancaster, which has been closed for months because of Government restrictions

It is also calling for the existing reduced VAT rate of five per cent for the hospitality sector to be maintained while extending it to include sales on alcohol.

Meanwhile, it calling for steps to level the playing field between high street retail and online.

The full list of measures set out in the relief package for the hospitality and high street sectors and their respective costing include:

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* Provide hospitality businesses with a COVID-investment rebate - £690m

* Extend hospitality’s reduced VAT rates for remainder of 2021 - £6.3bn

* Include alcohol in hospitality’s reduced VAT rates - £750m

* Cut in half Britain’s alcohol taxes - £1.8bn

* Make hospitality investments 100 per cent First Year Allowance (FYA) - £1.15bn

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* Continue the suspension of business rates 2020/2021 - £15bn

* Cut VAT rate payable by physical retailers to 14 per cent - £7.6bn.

* Freeze town centre parking fees - £872m

* Reintroduce Eat Out to-Help Out and complement it with a “pro-hospitality” advertising push - £1.08bn.

Mark Whittle, Preston City Centre Business Improvement District manager, said: “We have called for some time for the business rates system to be reformed.

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“It’s even more crucial now. Whilst many businesses have endured a really tough year, businesses in the retail and hospitality sectors have really gone through the mill, with almost constant stop starts.

“The government schemes introduced to date have helped, but they can and must do more to protect viable businesses.

“The retail, leisure and hospitality sectors are worth over £635b to our national economy. It’s absolutely vital that we continue to support all businesses, especially those who have barely had any opportunity to trade for almost a year, to ensure that they are in strong position to return to trading end offering employment following the effects of the pandemic.”

Dominic Leighton is landlord of the Three Mariners in Lancaster.

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His pub has stayed closed for months, having decided that a takeaway service would be unviable.

Like many he is anxously waiting for a reopening date from the Government.

He said: “It’s clear that the hospitality industry will need a considerable amount of help this coming year, and the suggestions outlined here would go a long way to protecting jobs and businesses.

“At this stage it’s unclear when hospitality venues will be able to return, and while the current support has been extremely welcome, the industry will not simply bounce back when doors swing open.

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“If the government wants British high streets to survive they need to introduce the kind of measures the IBN has set out.”

Meanwhile, the Night Time Industries Association has warned that without urgent action 2021 will see the ‘extinction’ of nightclubs.

Nightclubs and late night venues have been closed since March, with many suggesting they will not survive past the end of February.

The NTIA says that nightclubs/late night venues have been given limited, and in many cases hugely disproportionate support outside of furlough for the year they have been closed and suffered extreme financial hardship for over 11 months.

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Many see the end of February as the last stand for their future.

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