Under the new tier system announced yesterday, 98% of the UK’s hospitality businesses will now be forced to operate in tier 2 and 3 regions, according to UKHospitality.
Should the restrictions last the entire month of December, an estimated £7.8bn worth of trading is set to be wiped out, compared to 2019.
Yesterday the government announced that 21 local authority areas will be placed in tier 3, the strictest level of tier under the coronavirus rules. This means hotels, pubs and restaurants will have to close and offer takeaway or delivery only.
More than 120,000 venues England have been placed into tier 2 or 3 regions, with 94% of UKHospitality members saying they will be unviable or trading at a loss due to the restrictions.
UKHospitality chief executive Kate Nicholls said: “The new tier system will deliver another huge blow to hospitality.
“The new tiers will see over 120,000 venues across England placed into Tier 2, with tens of thousands of these forced to close as they are unable to provide a table meal, either physically or financially. This affects the employment of nearly 1.5 million people. Under this severe a restriction, 94% of our members say they will be unviable or trading at a loss.
“For the 38,000 businesses in Tier 3, employing over 540,000 there is no option but to provide takeaway or close altogether.
“We still have not seen any evidence that hospitality venues – which have invested great time effort and money to making their spaces COVID-secure – are a problem area in terms of infection, so it seems unfair and arbitrary that hospitality is being dealt such a harsh hand. According to a recent UKH survey, 72% of visitors to hospitality were satisfied with the safety of our venues, compared to just 11% who were not.”
She argued that it is now vital for the government to provide urgent further financial support for the sector, before the industry sees huge job losses, and the permanent closure of many businesses.
She added: “If we want to see businesses survive, then we desperately need a replacement for the Job Retention Bonus Scheme and for the Government to extend the rent moratoria and broker a solution to tackle the issue of rent debt that has built up. If we want to give those businesses that do survive this winter a better chance at succeeding next year, then the VAT cut and businesses rates holiday must now be extended and grants provided to support businesses paid out at the earliest opportunity.”