Industry leaders call on Government to provide 'urgent' business support for hospitality sector

The letter, addressed to Prime Minister Boris Johnson, calls on the Government to act decisively for a sector and urges it to commit to an ambitious programme of business support and investment.

According to trade body UKHospitality, sales across the sector are expected to be 56% lower than last year, reducing revenues by £73.4bn.

It adds that half of businesses do not expect to reach breakeven until the end of next year, highlighting 'the urgent need for decisive support' to maintain jobs and prevent further business failures.

The letter sets out three recommended areas in which the Government can support businesses: restart, recover, and revive. 

In the first instance it asks for the Government to extend the deferral of all tax liabilities to cover the closure and reopening period in full; and establish a targeted Hospitality, Leisure and Retail Property Bounceback Grant to cover a proportion of the rent debt accumulated by operators while they have been closed.  

For the recovery, it asks the Government to incentivise spending by temporarily reducing VAT to 5% for hospitality services; and protect jobs by allowing hospitality employers to access full furlough to the end of October and double the employer National Insurance contribution threshold.

Finally, it demands the Government help secure the sector's revival by extending the hospitality business rates holiday to March 2022, ahead of fundamental reform of the business tax system.

“Our sector has been a high-profile casualty of this crisis and businesses are only now just beginning to reopen," says UKHospitality chief executive Kate Nicholls.

“For those businesses that have survived, the hard work begins now. We cannot assume that we are now in the clear just because our doors are open again. Many businesses have taken huge hits and hundreds of thousands of jobs are still in the balance.

“If we want to make a real success of this reopening, keep businesses alive and jobs secure, then the Government needs to provide support. Support from the Government has been extremely helpful in keeping venues afloat and it has saved jobs.

"There is no possibility of stopping now, though. Anything less than a full show of support from the Government risks undoing much of the good work that has already been done and will cause lasting damage to employment and the UK economy.

“We urge the Government to act decisively and positively to give hospitality the best possible chance of not only surviving the crisis but thriving in the aftermath.”