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Furlough extension “wasted investment” without further support

Published:  06 November, 2020

Trade bodies have welcomed the extension of the Job Retention (furlough) Scheme (JRS) but warned that this alone is not enough to keep hospitality alive. 

UK Hospitality (UKH), The Society of Independent Brewers (SIBA) and The Scottish Licensed Trade Association (SLTA) all said that broader support was still needed, with UKH saying without this the furlough extension would have been “a wasted investment of public funds”.

“We will need enhanced grant support to keep venues alive and a solution to the ongoing rent debt problem that continues to linger over the sector. These must come alongside a clear roadmap for a return to business. Without these, the extended furlough scheme alone is not enough to keep hospitality alive and will have been a wasted investment of public funds,” she said. 

Surviving the winter was “just the first step, too”, she added. “Beyond that we need action to ensure that businesses can be revived and the sector can play its part in rebuilding the economy. Extending the VAT cut and business rates holiday, coupled with extensive government promotion of tourism and hospitality, will be the bare minimum required.”   

SIBA echoed this saying that a furlough extension was only one of the asks from SIBA and other trade bodies, with grants for basic running costs for all pubs and breweries, extension of business rate cuts to breweries, a VAT cut on beer, compensation for beer destruction and big action on beer duty “all being ignored”, said CEO James Calder.

Moreover, SLTA urged the industry not lose sight of the fact that direct support for businesses was still “woefully inadequate”.

“Unless this is increased substantially, there is still the threat of business failure leading to the loss of thousands of jobs and jeopardising the intentions of the Chancellor’s extended support package announced today to save jobs,” said spokesman Paul Waterson. 

While yesterday’s announcement would give the industry “a bit of a breathing space”, the government needed to "plan ahead and give industries much earlier indications of what support will be available rather than making announcements at the eleventh hour”, he added. 

“Over 50% of jobs in the pub and bar sector could still be lost without increased and immediate aid directly to businesses owners and operators. Business closures and job losses will have a particularly deep impact on the employment of young people as over 45% of staff employed are under the age of 25.

“The announcement today will give the industry a bit of a breathing space, but the government needs to plan ahead and give industries much earlier indications of what support will be available rather than making announcements at the eleventh hour.”

The trade bodies said they would continue to campaign for a full six month package of measures for the industry and its supply chain.