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Warning that many pubs will permanently close without support

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Written by: Emma Lunn
21/12/2021
Figures from UKHospitality show that December is set to be a disaster for the hospitality sector, with hopes for a better 2022 already laying in ruins.

The industry body reported that more than half (54%) of venues were down more than 40% in revenue last weekend, with one in five businesses reporting a sales drop of more than 60%.

On top of these bleak trading figures, 88% of operators say they feel negative about the potential of New Year’s Eve trading and four in five operators have already experienced cancellations for bookings in what was already set to be a quiet Q1 next year.

A separate survey, for the Tourism Alliance, showed that a third of pubs, bars and restaurants have no cash reserves and 10% of pubs and 14% of restaurants are therefore very likely to fail, with consequent job losses.

Without any form of government support a further 40% are at risk of failure. Accommodation businesses are only slightly more resilient with 22% reporting no cash reserves – 47% with less than 2 months’ worth – with 26% at risk of failure in the next year without further support.

The figures were released after rumours circulated yesterday about a return to Covid level 2 restrictions from 27 December amid surging Omicron infections. A return to level 2 restrictions would mean a ban on indoor socialising – pubs could only serve customers outdoors, with rules about the number of people who can gather and the number of households they can be from.

However, despite a lengthy cabinet in the afternoon, the government failed to make any announcement about restrictions after Christmas.

Kate Nicholls, UKHospitality chief executive, said: “Hospitality operators desperately want to keep their doors open and trade their way to recovery, particularly during the Christmas period, which is not only key for balance sheets but for the communities and people our businesses serve. However, these catastrophic figures clearly show that trading levels are now so low that without government support many businesses will not survive into the New Year and jobs will be lost. Cancellations have annihilated cash reserves.

“The industry urgently needs grants for short-term business survival and an extension to business rates relief and the lower VAT rate to secure longer term survival and planning. It is also crucial that the government lets the industry know as soon as possible if measures are to be imposed and what they might be, to allow for as much damage limitation as possible.”

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