New beginnings… or a truly dire situation?
We all hoped that the start of 2021 might herald a new beginning but unfortunately we find ourselves in yet another national lockdown, and the future for many in the hospitality sector and its supply chain is truly desperate, says Jamie Shail, hotelier and restaurateur, owner of Rothay Manor, Ambleside in the Lake District.
Christmas 2020 was fraught for many restaurateurs, hoteliers and publicans across England. Ordinarily as you might expect our hotel and restaurant, just like many others up and down the country would be full of guests.
However, that all rapidly changed with the government’s announcement on 19thDecember, which placed London and a number of adjoining areas under tier-4 restrictions. At the same time, it was also announced that there was to be a reduction in the length of time period of time ‘‘bubbles’’ could mix.
The result was inevitable and over half of our guests were forced to cancel their stays over the festive period. Alongside that the spectre of a more virulent strain of COVID-19 found in the UK population reared its head. This more infectious variant heralded a rapidly increasing number of confirmed cases and an ever-increasing number of deaths, which could inevitably only lead to another national lockdown.
This became a quasi-reality with the government’s announcement made on 30thDecember, which virtually locked down the entire country from the morning of the 31st December, placing most of the country in tier-4 and thereby removing any possibility of hosting New Year guests, another serious blow among many in 2020.
Whilst we appreciate the seriousness of the situation, how could 8 hours’ notice of closure provided be considered enough? It’s simply shameful and was a direct repeat of the first national lockdown and the closure of all hospitality.
Along with many of our colleagues across the country, had ordered thousands of pounds of fresh produce, prepared elements of dishes and rostered a full complement of staff in preparation for a socially distanced New Year. Instead, the food we couldn’t save was wasted, obviously we had to cancel all guest reservations with immediate effect, and we’ve once more had to furlough the team.
Then on Monday 04th January the prime minister announced our third national lockdown in the face of rising new variant COVID infections. Understandably there is as yet no realistic end date in sight for the lifting of restrictions, the lack of information available at any level and the distinct lack of a long-term recovery strategy is quite simply staggering.
Once more hospitality has borne the brunt of the hit, as two of the most profitable weeks of the year were in effect cancelled. As businesses we can’t carry on like this, right across the board the sector traditionally relies on its Christmas income to get it through the lean months of January and February and that revenue has gone but the bills still have to be paid.
Against this backdrop we have to ask how much more can the hospitality sector and the overall economy take? More financial support most be forthcoming if we are to have any hope that hospitality businesses will survive. As a sector we can’t keep opening up and then almost immediately be told to close down again with very little economic support from the Government.
It seems abundantly clear that central government has no interest in saving jobs in the UK’s third largest private sector employer, which until the start of 2020 generated £130 billion and until employed around 3.2 million people directly and a further 2.8 million indirectly involved in all aspects of the supply chain.
This appears to be borne out in the latest UK unemployment figures, which show that around a third of all job losses seen since February have been in the hospitality sector in other words of a total 819,000 job losses since February, 297,000 were in the sector.
The revised tier systems will now be in place until at least April 2021 at the earliest, but what support is there to help a sector that relies on both the summer and Christmas trade to get it through the winter months especially with the lack of seasonal parties, reduced numbers of covers, reduced wedding numbers and so on.
Ok, we may have some financial support in the form of Chancellor Rishi Sunak’s new financial package which is designed to prop up the retail, leisure and hospitality businesses affected by the restrictions with grants worth up to £9,000 “per property” but that barley covers costs for a few weeks in most cases. Heating, lighting, rent, staff costs, food costs etc still have to be taken into account.
We’ve invested, trained, and monitored but this simply hasn’t been taken into consideration when it comes to the plight of the sector. Especially when you consider that according to recent forecasts published by PricewaterhouseCoopers that the daily revenue per hotel room, which is a key indicator for the sector isn’t due to revive to the levels experienced in 2019 until at least 2024 in London, and 2023 across the rest of the UK.
Yes, those affected by the latest national lockdown have been given some relief by the Government’s decision to extend furlough and some of the business support schemes available earlier in the year. But many of the measures fall well short and there seems to be no clear or coherent plan to offer ongoing financial support, or for that matter a clear route map for re-opening businesses longer term.
It seems the government feels they have fixed the problem by reducing VAT to the end of March. Nothing could be further from the truth, reduced VAT with no tangible income is hollow, and it certainly doesn’t help to cover operating costs, heating, lighting, pension contributions, NI and so on. Should the government choose to revert to standard VAT rates It would be instantly crippling for many to cope with a 15% VAT hike overnight!
The sector in my view needs a structured recovery plan for the next 6 months (as a minimum), some way for us to plan and to know what we need to be doing with assistance that goes past next March.
I firmly welcome the call for a Hospitality Minister, it’s only right and proper that a sector that brings so much to our economy is properly represented by this and successive governments.
I urge those that haven’t signed the petition launched by Claire Bosi of Chef & Restaurant Magazine to do so https://petition.parliament.uk/petitions/552201 , and add their weight to the debate in Parliament which is set to take place on Monday 11th January at 4.30pm.
Jamie Shail, hotelier and restaurateur, owner of Rothay Manor, Ambleside in the Lake District.
