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Three quarters of hospitality businesses could close in 2021

Published:  19 November, 2020

Trade bodies have called for an adaptation of Tier restrictions as they warn almost three quarters of hospitality businesses could close without further government support.

Under the current Tier restrictions, the trade bodies warned that 72% of hospitality businesses expect to become unviable and close in 2021, according to a members survey of UK Hospitality, the British Beer & Pub Association and the British Institute of Innkeeping.

Under Tier 1 restrictions, only 25% of operators said they could turn a profit, while under Tier 2, 76% said they would be unviable or operating at a loss. 

Moreover, for those hospitality businesses having to operate under Tier 3 restrictions, the survey found 94% would be unviable or operating at a loss. 

“The evidence is here to see of the devastating, long-term impact the government’s restrictions are having on hospitality and pub businesses. Without a change in approach and more support from government, much of our sector could be gone within a year – that means businesses and jobs lost plus much-loved venues closed forever,” a joint spokesman for the organisations said. 

While recognising that local restrictions would need to be based on local risk levels, to ensure the sector could “bring people together properly” this Christmas and beyond, and provide them a safe environment to socialise in, the trade bodies said the Tier system should be “fine-tuned”. 

“That means relaxing the ban on more than one household in Tier 2 and extending the 10pm hard curfew cut-off point,” they said. 

“Those pubs and hospitality venues facing Tier 3 restrictions currently have an impossible task of trying to remain viable as businesses. In recognition of this, the government must enable wet-led pubs to re-open in Tier 3 where they do not serve food, as well as significantly enhance the grant support for those businesses not viable across all tiers, but especially those in Tier 3.” 

The survey was conducted this month by CGA. 

Last month, before the current lockdown and before the full impacts of the Tier system was announced, a similar survey by the trade bodies suggested that hospitality faced 750,000 job losses without further government support.