LEAVING LOCKDOWN

JANICE ON THE LONG ROAD BACK TO NORMALITY.

The definition of a “Pathway” is a series of actions that can be taken in order to achieve something. This week the Executive released its long awaited paper on the road out of lockdown. Titled, Moving Forward: The Executive’s Pathway Out of Restrictions, this publication was greeted by dismay with a lack of dates being identified as possibly its greatest failing.

The document details 3 measures and 5 periods of easement across nine pathways. Hotels have been placed in the travel and tourism pathway. However, the complex nature of hotel trading would place certain activities under the at least three other pathways: Worship and Ceremonies, Hospitality and Sports and Leisure Activities. It could also be argued that the pathway for Culture & Heritage and Entertainment will affect recovery of the hotels as well. In a summer whose success appears to be based on the “staycation” the availability of things to see and do will play a critical role in the attractiveness of Northern Ireland.

The reaction to the Executive’s document is hardly surprising. With no dates, no clear route or progression and a process based on 9 pathways over 5 phases, the prospect of 45 plus permutations is a cause for concern (never mind confusion). It should be noted that there is some sympathy for those political decision makers who are facing an unprecedented situation. There is a realisation that the transition of COVID-19 from pandemic to endemic status was never going to be simple. After a disastrous cycle of opening & closing in 2020, culminating in the festive fiasco of Christmas, businesses want to open within a viable framework in a sustainable manner.

The document gives four review dates. The first of these is 16th March and the understanding is that there will be little easement for travel, tourism and hospitality on that date. 15th April is the next review day and the indication is that collaboration with industry will take

JANICE GAULT

Chief Executive

COVID-19 Return to Trading for Hotels

NORTHERN IRELAND HOTELS FEDERATION

DOCUMENT.

February 2021

5-STAGE PATHWAY.

» The Federation set out the five steps needed for the industry to get back to normal.

» This is the pathway document published by the Federation in February 2021.

place as pathways are reviewed possibly around this time. The publication of the pathway paper has resulted in cancellations, a falling off in demand for hotel stays and anxiety for staff. Vaccine rollout, falling infection numbers and an easement of the pressure on the health service are all positive developments which give hope. However, a date, a timeline and a framework are what businesses need to survive and reopen.

The Federation sees the pathway back to normally stretching over five phases. Support will be required throughout this journey.

Restoration of the economy and the establishing of societal norms will come. However, the price the hotel sector and the wider tourism industry have paid has been enormous. The Federation published a policy paper in February and has pressed for 8 key support measures.

It is good to see that some of these measures have been addressed in the Budget of 3rd March 2021. In the main, the approach has been a short term one, with VAT extended for six months and a new VAT band introduced for the remainder of the fiscal year. Local support by way of grants has been put in place and the hope is that this will continue until recovery is underway. The NIHF will continue to press for a better business climate.

There is a flicker of light at the end of the tunnel. The issue for hotels is that we do not appear to be around the corner to see it, just yet!

BUDGET BULLETIN

POSITIVE STEPS IN RELATION TO VAT, INVESTMENT AND FURLOUGH BUT PLANS FOR RE-PAYING THE NATIONAL DEBT ARE COMING.

The Chancellor Rishi Sunak presented his second Budget on Wednesday 3rd March 2021. In his speech he stated his Budget ‘meets the moment with a threepart plan to protect the jobs and livelihoods of the British people’.

Main Budget proposals

Tax measures include: • A super-deduction for companies investing in new plant and machinery. • A time extension of the temporary increase to the SDLT nil rate band for residential property in England and Northern

Ireland. • An extension to the temporary 5% reduced rate of VAT for tourism and accommodation until 30th September 2021. The introduction of a new 12.5% rate until 31st March 2022. • A temporary increase in the carry-back period for business losses. • An increased rate of corporation tax from 2023.

Other Measures: • Extension of the Job

Retention Scheme to 30th

September 2021 under its current terms but with employers contributing 10% of wages in July and 20% in August and

September. • Self-Employment Income

Support Scheme fourth and fifth grant. • A new mortgage guarantee scheme. • Business Rates relief for

England, this is a devolved matter with the local rates position to be fully clarified by the Department of

Finance.

A number of initiatives in the Budget are not UK-wide and may be implemented in a different manner in Northern Ireland.