UK’s coronavirus policy will ‘devastate’ on-trade

The government’s advice to avoid visiting pubs, bars and restaurants to slowdown the spread of coronavirus (Covid-19) will have a “devastating effect” on the already struggling on-trade sector, according to the head of the British Beer and Pub Association.

On Monday evening (16 March) the government instructed people to avoid public venues such as theatres, pubs, bars and restaurants, but fell short of forcing their closure altogether.

Emma McClarkin, the head of the British Beer and Pub Association, said the new measures will impact pubs “with devastating effect.”

“The very existence of thousands of pubs and a lot more jobs is now at risk.”

McClarkin added that urgent measures to support cash flow and help businesses to cut costs and stay afloat when footfall is down is “an absolute necessity.”

In an open letter to the government, the BBPA said the pub and brewing industry is facing an existential crisis as a direct result of the guidance issued by the government.”

“Advising that people avoid pubs did not provide any form of advice or clarity on how the industry should respond,” it said.

“This is unhelpful in the extreme. At the same time the absence of any financial commitment to stand behind all businesses including small community pubs is creating panic with people being fearful that their livelihoods will be destroyed.”

Prime Minister Boris Johnson has warned that the UK could be approaching the “fast growth of the upward curve” of confirmed coronavirus cases, which now means cases are expected to double every five days, unless “drastic action” can be taken.

Although he said the government would not enforce the closure of theatres, restaurants, pubs and bars, it has “the powers if necessary” to do so.

McClarkin said the on-trade needed more clarity from the government, as well as direct financial support to ensure that business owners can pay their rent, bills and staff while trade grinds to a standstill.

“Forced pub closures without a meaningful support package will have a catastrophic financial and social impact,” she said.

The BBPA has called on the PM to take a number of actions “as a matter of urgency in order to prevent mass job losses and permanent pub closures”.

They include:

  • The cancellation of all business rates payments for a period of six months, as well as all HMRC tax payments, including PAYE, VAT and corporation tax for pubs/hospitality businesses
  • Cancellation of beer duty payments for a period of six months
  • Ensure banks are encouraged to extend credit lines and favourable-terms loan payment holidays to keep businesses afloat/pay wages
  • Put in place a temporary redundancy scheme in which, as in the Danish system, the Government commits to supporting 75% of the wages of those made redundant for a defined period
  • In the medium term, explore the viability of a substantial VAT cut for a period of time in order to drive trade back to the hospitality sector
  • Postponement of the planned National Minimum Wage/National Living Wage increase due in April in order to ease pressure on cash-flows

 

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