UKHospitality has written to the chancellor of the exchequer, Rishi Sunak, warning that additional financial support is “absolutely vital” to ensure hospitality businesses survive a bleak winter.
Funds will also be necessary to ensure companies are in a position to help power economic growth next year, the trade body argued.
Ahead of the a spending review, the trade association is warning that hospitality is set to lose the majority of its ‘golden quarter’ with Christmas sales severely depressed, as it then heads into the worst quarter for sales, from January through March.
The removal of the Job Retention Bonus (JRB) has also materially damaged businesses’ ability to survive and creates a £2.1 billion black hole in the sector’s finances in February.
The letter follows the release of a new survey of hospitality businesses which shows that, by February, and without further government support, around 600,000 jobs will be lost against employment figures from the same month this year.
The letter calls on the government to act in five areas to protect hospitality businesses:
Announce a successor scheme to JRB as soon as possible, with an early drawdown facility
Extend the business rates holiday for a further year from April
Continue the VAT cut for hospitality and tourism for the duration of 2021
Broker a workable solution on the huge rent debt hanging over the sector, supported by a moratorium extension
Maintain the VAT Retail Export Scheme
UKHospitality argues that this package of additional financial support will put the sector in a position to rebuild next year and continue its position as a major contributor to economic and social wellbeing across all regions of the UK.