A report into the measures needed to rescue the hospitality sector has called on the government to introduce a £690m rebate programme to compensate operators that have shelled out thousands of pounds on Covid-secure equipment during the pandemic.
The Independent Business Network, which produced the report, said that a rebate for equipment was the “most pressing issue in need of redress” and would be of immediate benefit to smaller enterprises forced to purchase safety equipment on mass.
It claims the lack of clarity over the reopening of the hospitality sector in July last year left operators with little time to prepare, causing businesses to make financial outlays without confidence that they were spending on the right things.
Many operators – anticipating that there would be several months during which they had been entrusted with a responsibility to minimise the spread of the virus – made significant outlays into protective furniture, PPE, procedures to aid the government’s track and trace, thermal measuring software and mobile ordering apps.
JD Wetherspoon, for instance, spent £11m on fitting Perspex screens, reconfiguring bar layouts, and ‘Covid-proofing’ buildings of various sizes and structures, the equivalent of £12,500 per venue. Greene King, meanwhile, invested almost £9,000 per pub as part of a £15m programme to open its business safely.
The report said: “When looking at ONS investment figures for the second quarter of 2020, it is a fair assumption to make that large portions of the £220m invested by the ‘hotel and restaurant’ category was spent on Covid infrastructure and equipment.
“These figures do not account for increased operational costs as a result of these measures that are much harder to quantify.”
The IBN said that setting a compensation rate at a maximum of £10,000 per individual hospitality business was an ‘appropriate level’ and estimated that the government would need to provision for a potential 69,000 claimants.
“By doing so, the government would be acknowledging the agony that its dithering has inflicted on pubs and restaurants. It would also be a recognition of the fact that the onus must eventually fall onto the shoulders of private enterprises to ‘Covid proof’ the parts of society currently prevented from opening.
“By applying a retrospective rebate system to the hospitality sector’s first wave of Covid-investment it would be sending a clear signal that enterprises across the country will have the government’s backing in taking measures to improve public safety.”