Thousands of hospitality businesses will collapse in the new year because of lost Christmas trading and a lack of government support.
Patrick Dardis, chief executive of pub chain Young’s, told Radio 4’s Today Programme that much of the hospitality sector was “hanging on by their fingernails”, hoping for good Christmas business.
He accused Boris Johnson and chief medical officer Chris Whitty of offering mixed messages and of leaving people “terribly confused” in their addresses in recent days.
Dardis said: “As a consequence, thousands and thousands of businesses will now collapse in January.” He added that hospitality owners were beginning to “throw in the kitchen sink” having lost customers, livelihoods and marriages.
Christmas was “the bit that they were desperately clinging onto, and it’s been taken away from them without any support from government”.
Christmas party booking cancellations would mean many pubs would not survive, he said.
Celebrity chef Tom Kerridge told the BBC one of his restaurants had 654 cancellations in the past six days, during a time of year for the industry which is trying to “claw our way back to some sort of normality”.
He said bar and restaurant owners “wouldn’t have a problem” if they had to close from a “government and scientific point of view” because of Covid, as long as financial support was put in place.
Meanwhile, the CBI urged ministers to provide support “in lockstep with future restrictions”, and UK Hospitality has called for business rates to be deferred and VAT discounts extended.
Dardis referred to a “campaign of fear” over Omicron, echoing remarks made by Wetherspoon founder Tim Martin who accused the government of introducing a “lockdown by stealth”.
Martin said on 13 December: “The repeated warnings and calls for restrictions, mainly from Sage [committee] members and academics, combined with arbitrary changes of direction from the government, invariably at short notice, affect customer sentiment and trade.
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“In effect, the country appears to be heading towards a lockdown by stealth.”
Dardis said the government should leave the VAT rate on hospitality at the current temporarily level of 12.5%, and not return it to 20% next spring as planned. It should also scrap business rates, he said.
HR and employee benefits specialist Steve Herbert said the accusations of “lockdown by stealth” being made by the hospitality industry were “possibly a little unfair given the speed of the developing situation” but the problems faced by hospitality were clear, particularly given the withdrawal of state support for businesses in the form of the furlough scheme.
“So the pressure is once again on The Treasury to offer some new financial support,” Herbert said.
He pointed out that the chancellor Rishi Sunak would “probably be reluctant to commit yet more funds given the vast amount of public money poured into the economy since March 2020. Yet the risks of not doing so make it rather like a high-stakes poker game.”
Meanwhile, Sunak has come under fire for going ahead with a four-day visit to California to meet tech and financial leaders as the Omicron variant bites in the UK. Shadow health secretary Wes Streeting said Sunak should “get himself on a flight back and get a grip on the situation”.
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Streeting added Sunak should agree a deal to help businesses hit by lower footfall because of the rise in Covid-19. “Businesses need certainty and confidence now,” he said.
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