New grants welcomed as sector reels from latest lockdown

Business leaders have welcomed new financial support for hospitality businesses but warned the latest government measures are only a “sticking plaster” solution to the existential crisis facing the sector.

On Tuesday the chancellor, Rishi Sunak, announced an additional £4.6bn in new lockdown grants to support businesses and protect jobs in the retail, hospitality and leisure sectors. It followed the decision to force non-essential businesses to close until at least February half-term in order to help control the spread of the coronavirus.

The grants are worth up to £9,000 per property and are designed to help businesses forced to close due to the latest national lockdown survive until the spring.

A further £594m of discretionary funds have been made available to support other impacted businesses including those in the hospitality supply chain.

UKHospitality chief executive, Kate Nicholls, said the support was “very positive” and must be welcomed, however she added that “this is only a sticking plaster for immediate ills – it is not enough to even cover the costs of many businesses and certainly will not underpin longer-term business viability for our sector”.

Nicholls called on the government to confirm extensions to the business rates holiday and of the 5% VAT rate to address the “existential challenges that hospitality faces”.

Businesses were already reeling from the damage caused by seeing trading opportunities severely curtailed during the ‘golden quarter’ leading up to Christmas.

And although pubs and restaurants will be allowed to offer takeaway services, there is confusion over whether this will extend to sales of alcohol which have been permitted during previous lockdowns but were excluded from the government guidance published this week.

“Takeaway sales, in sealed containers, for people to take home, were a real lifeline for the trade in previous lockdowns and restricting that route to market now would be a death knell for many pubs,” said CAMRA Chairman Nik Antona.

There are concerns too over the risk of huge volumes of food going to waste after thousands of schools were forced to close their doors at only a day’s notice.

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