Is Hopsitality a Scapegoat?

Words by:

Ann Tonks Managing Director Opus

Is Hospitality a scape goat?

Our country is in an endless cycle of reaction rather than planning. Our hospitality venues are buffeted by ‘restriction creep’ - momentum begins to build only to be stopped by further restrictions that are poorly thought through and are causing more harm than good.

The impact of the PM’s announcement this week that Birmingham is being thrust into Tier 2 is devastating to the city and to our hospitality industry. We are going backwards. We need a robust, logical strategy for re-opening the economy with a clearly communicated plan. This announcement in Parliament did not accomplish that.

The lack of evidence-based restrictions that target hospitality cause huge frustration and uncertainty. We challenge the government to produce evidence that restaurants in Birmingham are spreading the virus. The majority of hospitality venues have been superb at compliance, but are now the victims of government failures. The lockdown was supposed to buy us time to get the basics right. Emerging from total lockdown was always going to lead to greater risk of spread and that’s where a robust track and trace system should have come in.

As a result of being in Tier 2, Opus estimates we will immediately witness a decline of at least 60% of our bookings; single households do not account for that much of our business. This will be true of many of our colleagues across the city. The overall effect on sales means our turnover will be at best 20% of normal, pre-Covid levels.

Staff working hours will have to be radically reduced. With no further financial help from the Treasury, there will be huge redundancies and restaurant closures. Even two weeks as a Tier 2 city is financially unviable.

Treasury support must come with these devastating and ill thought through restrictions. It is financially better to be forced to close than to try and stay open; at least Treasury support is there for complete closures, not so for trying courageously to carry on.

We urgently need the following Treasury support:

1. Return to flexible furlough (the JSS is not fit for purpose as it is dependent on turnover that is growing, not contracting);

“At the end of the day, our biggest concern is for our dedicated, talented team. This is all about people – their safety and their livelihoods.”

2. Additional grants between £10,000 and £25,000 to help venues over this winter period, as Christmas sales will now be non existent - it is December when most restaurants make their annual profit.

3. We need to know now that VAT will continue to be at current level of 5% for hospitality/retail throughout 2021, and that business rates holiday continues through all of 2021; this allows us to plan ahead for what will be an extremely difficult road to recovery.

All of this financial assistance is essential not only for restaurants in Tier 2, but is needed for all hospitality as the nation is returning to a quasi-lock down situation - any momentum that has been built over the summer and early autumn has reached a full stop. The hospitality economy is contracting. Further, we need the government to recognise that the curfew for hospitality must be changed from 10pm to midnight.

At the end of the day, our biggest concern is for our dedicated, talented team. This is all about people – their safety and their livelihoods. We have a team we are extremely proud of and they have been superb at helping us to make good decisions about how to adapt our business under the Covid circumstances. Opus to You was developed during lockdown to get meal boxes to customers, and its success has led to it remaining a part of our permanent offering.

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