Hospitality leaders warn of ‘a wave of business failures’ if roadmap is pushed back: Hospitality sector leaders, including Nick Mackenzie at Greene King, Phil Urban at Mitchells & Butlers and Simon Longbottom at Stonegate Pub Company, have written to the chancellor Rishi Sunak warning him Britain risks “a wave of business failures” if the roadmap is pushed back past 21 June, amid growing speculation that “Freedom Day” will be delayed by up to a month. Signatories of the letter, which also include Nick Varney, chief executive of Merlin Entertainments; Steve Richards, chief executive Parkdean Resorts; Simon Emeny, chief executive of Fuller’s; Patrick Dardis, chief executive of Young’s; Peter Marks, chief executive of Rekom; and Rob Pitcher, chief executive of Revolution Bars; and has been compiled by UKHospitality, warn that around 300,000 jobs are at risk if restrictions remain in place. They fear a one-month delay to the removal of social distancing guidelines would cost the industry around £3bn in sales. They wrote: “As you know, hospitality has been the hardest hit during the crisis of the past 15 months, shedding 65% of sales in the year to March. Even now, with partial reopening, sector sales remain down 42%. The consequences of restrictions remaining would be profound. We estimate that around 300,000 jobs would be put at risk – including those still on furlough. A one-month delay would cost the sector around £3bn in sales in that month – but will also have a knock-on impact on bookings throughout the summer and into the autumn. It would further jeopardise the future of thousands of businesses, including many that still have not reopened their doors since last March. Confidence in reopening would be shattered, despite the incredible sums invested in our venues to restrict covid transmissions, on the introduction or upgrading of measures such as improved ventilation, enhanced cleaning, Test & Trace and many more. Alongside the impact on revenue, businesses are now facing an increase in costs. From July, business rates will recommence. Even with the discount available, we estimate this will be a £95m monthly cost to struggling businesses. Employer contributions to the Coronavirus Job Retention Scheme will also kick in, alongside existing expectations on national insurance contributions and pension payments. There are still hundreds of thousands of hospitality staff on furlough – the sector will either have to pick up a huge bill or make people redundant – an invidious position. Businesses are also facing their quarterly rent payments in just two weeks with landlords under the impression the sector is trading freely. The moratoria on rent and debt enforcement are due to come to an end at the end of this month, which would unleash a wave of business failures. We believe government must now act decisively, by: removing all restrictions on 21 June, extending the 100% business rates holiday for a further three months without a cap, extending the rent and debt moratorium to allow government and industry to find a solution to historic rent debt, and extending the period of 5% VAT rate for hospitality and tourism for the same period that restrictions remain and retain the 12.5% VAT rate beyond March 2022.” The letter comes as speculation grows that Boris Johnson plans to delay the 21 June lockdown lift until 19 July after cases of the Delta variant tripled in a week. The Sun reports that under plans drawn up to be announced on Monday (14 June), a two-week review will be included meaning covid restrictions could be dropped on 5 July if hospitalisations stay down. A senior Whitehall source told The Telegraph: “A delay would allow for more first doses but also, critically, more second doses and more time for those doses to take effect. It would give protection to many, many millions of people who haven’t had their second doses yet but may be vulnerable to coronavirus. The prime minister always said the reopening should be ‘cautious but irreversible’. We don’t want to do anything that risks going backwards.” Face coverings, work from home advice and social distancing are all expected to remain, together with the “rule of six” and restrictions on numbers allowed in arenas, theatres and other venues. Nightclubs will remain closed.
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