UK pub and beer sector in ‘project restart’ as lockdown review deadline looms

The UK’s pub and brewing sector is preparing to “restart”, as the government gets ready to review the country’s current lockdown measures next week.

As UK Prime Minister Boris Johnson is admitted into intensive care to treat “worsening” coronavirus symptoms, foreign secretary Dominic Raab stood in to give an update on how the government’s lockdown measures could work.

On 23 March, Prime Minister Boris Johnson asked all “non-essential” shops in the UK to close, allowing online retail to continue as normal. The public were also told to stay indoors as much as possible, only leaving the house for exercise, or to buy food or other essentials.

The announcement came a week after pubs, bars, restaurants and leisure centres were also told to shut their doors, but Johnson added a kernel of hope, saying the measures would be under “constant review”, adding the government would “look again in three weeks, and relax them if the evidence shows we are able to.”

James Calder, the chief executive of the Society of Independent Brewers (SIBA), told db the industry body is “right in the middle of project restart”, and is in talks to find out when pubs and bars will be allowed to open, whether they will be given notice, and how quickly they will be allowed to resume full trading.

Perhaps unsurprisingly, it doesn’t look like those measures will be relaxed just yet.

Johnson was admitted into intensive care on Monday night (6 April). Deputising for the PM during a press conference on Tuesday, Dominic Raab appeared to pour cold water on any hopes from the bar and pub sector that the country’s lockdown measures will be relaxed next week.

Asked whether the measures will be relaxed when the three-week deadline is up on Monday 13 April, Raab said: “In terms of the review, we are not at that stage yet. We will take any decision when the time is right, based on the facts and the scientific and medical advice.

“Our number one and overriding focus right now is on conveying the key message, which is that everyone needs to keep adhering to this guidance.”

“There is a long Easter bank holiday weekend coming up, warm weather and we understand people are making big sacrifices to follow this guidance. It is helping, it is contributing to our ability to tackle the coronavirus.”

“The worst thing now would be to take our foot off the pedal, to ease up on that and risk losing the gains that have been made.”

A number of academic reports have suggested lockdown measures, which have forced pubs, bars and restaurants to close and led to widespread layoffs and staff cuts across the wine, beer and spirits sectors, could go on for months if they are to be truly effective.

Though Raab didn’t explicitly say that there would be an extension to the lockdown, it seems unlikely that the measures win place will be lifted next week.

Raab said: “The critical thing is to take evidence-based decisions and so we’ve said that we will take any review once we’ve got the evidence that the measures are working and having the kind of impact taking us past the peak which means that they can be responsibly done. We’re not at that stage yet.”

Hospitality on the brink

Over the past month, the hospitality sector has ground to a halt, and while many pubs, restaurants and bars have transitioned to takeaway and delivery services, or started selling groceries to keep revenues ticking over, staff are losing work in droves.

Tim Martin, the owner of pub group J.D. Wetherspoon was criticised in March for claiming that closing on-trade outlets was an “over the top” measure”, and that people wouldn’t catch the virus by going to pubs.

This morning (8 April), Martin told the drinks business he did not expect pubs to reopen “until hospital admissions, infections and so on are on a definite downward trend.”

“Hopefully that point will arrive in two or three weeks time.”

The number of shifts being carried out by workers in the hospitality industry has fallen 98% month on month, compared to a 77.6% fall just two weeks earlier, according to Wagestream, a startup that allows workers to access their pay on a rolling basis without affecting their employer’s cash flow. The app is used by 36,000 hospitality sector workers who would typically fill 120,000 shifts each week.

Businesses that were already in trouble before the lockdown came in force have started to go under. Mark Hix confirmed yesterday (7 April) that administrators have been appointed to his restaurants. It follows news of the closure of Hix’s Soho site last December after 10 years in operation, which Hix said was a result of rising rents and difficult market conditions.

High street restaurant chain Carluccio’s fell into administration last week, putting around 2,000 jobs at risk. The restaurant chain had already been hit by competition in the casual dining sector and challenging economic conditions before the impact of coronavirus.

“You have to remember that the last time a pandemic brought the country to a standstill, in 1918, a hospitality sector of the sort we know today did not exist,” said Peter Briffett, Wagestream’s co-founder.

Some companies have cut salaries or furloughed the majority of their workforce, while executives have offered to waive large portions of their salaries.James Watt and Martin Dickie, the founders of Scottish brewer Brewdog, said they will forgo their salaries this year as part of a plan to protect the business against the impact of coronavirus. The company told members of its Equity for Punks scheme that its revenues had fallen by 70% almost overnight since the government asked bars and pubs to close.

Tim Martin said in a statement on Wednesday 25 March it would introduce a new scheme that would see staff paid 80% of their normal wages by the company. Wetherspoon will then apply for up to £2,500 ($2,969) per employee per month back from the government under its new coronavirus job retention scheme. The move followed a public backlash from Martin sending a video to staff telling them they would not be paid until Wetherspoon received money from the government.

“It’s clear from these statistics that the commercial and human consequences of the pandemic are so far being managed through widespread use of the Government’s Job Retention Scheme.”

“Companies must look after their staff as best they can because, when the social distancing rules are lifted, these workers are their only way to get quickly back to business.

“We are continuing to allow client’s employees to access their accrued furlough pay when they need it and this should take away some of the financial pressures they will be experiencing right now.”