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Trade bodies urge govt to provide more targeted support

Published:  24 September, 2020

Trade bodies have urged the government to provide more sector targeted support following Chancellor Sunak Rishi announcement of the Winter Economy Plan earlier today. 

While the new plan, which includes a new Job Support Scheme to replace furlough and tax cuts (including an extension of the VAT break for hospitality), it is not enough, according to trade bodies. 

Calling for more support specifically targeted at the hospitality sector, Kate Nicholls, CEO, UK Hospitality, said: “The announcement of flexible employee support is a move in the right direction, but hospitality needs more targeted efforts to support jobs. 

“Almost 1 million people in our sector are still on furlough. We need government to go further in hospitality, recognising the greater restrictions imposed upon us, and pick up the full cost of unworked hours. This would be a relatively low cost for huge reward for our workforce. Full support to sustain people in their jobs during what could be a pretty bleak winter for hospitality would be a great step forward,” she said. 

Looking ahead, the extension of the VAT cut was “absolutely critical”, she added. 

“It is great to see the government taking note of our major concerns about recovery into 2021, though this must be extended further. The announcement of longer tax deferrals and the option of longer loan repayments should deliver some much-needed breathing room for employers.”

Moreover, the Food and Drink Federation (FDF), said the requirement for staff to be working part-time to be eligible for support would not be enough to sustain hospitality businesses and their food and drink manufacturing suppliers – the squeezed middle – through a difficult autumn and winter where pubs, bars, and restaurants will have significantly reduced custom. 

“The pandemic has had a far greater impact on some sectors of the economy than others – sectors that would continue to support millions of viable jobs once a vaccine is achieved and social distancing can end. Only by continuing a targeted furlough scheme while the current restrictions remain will we avoid mass long-term unemployment and the decimation of a sector that could otherwise support our economic recovery once the pandemic is over,” said CEO Ian Wright CBE.  

“We urge the UK government to engage with those industries most impacted about what more can be done to support those food and drink businesses most affected by the restrictions.”

The Society of Independent Brewers meanwhile said that while the new Job Support Scheme would save jobs it did not address the “serious issues facing the brewing and hospitality industries which have been amongst the worst impacted by coronavirus”. 

“Without targeted support for the beer, brewing and broader hospitality industry, which has been specifically targeted by new restrictions, then we will see widespread business closures of breweries and pubs,” said CEO James Calder.

“Breweries have not had access to any of the business grants available to other hospitality businesses during coronavirus and to avoid further business closures it essential that a targeted support package is introduced by government. 

“Equally whilst the extension of the VAT cut for hospitality is welcome for many pubs, it does not apply to beer or alcohol sales so is not available to wet-led community pubs which do not serve food. Without urgent support many breweries and wet-led pubs will not survive the vital Christmas period,” he warned.