Latest figures published by the ONS highlight just how economically important the hospitality sector is to the UK, which makes it all the more galling that the support being handed down by the government doesn’t go far enough.
Estimates for November show UK GDP falling by 2.6%, with hospitality, which was effectively closed in England during the month, accounting for just over one-third of the decline.
This really underlines how significant the sector is to the economy and the power that it has to drive a recovery when society properly reopens again.
But to do that, it needs to be in a viable state in the first place. Trade body UKHospitality claims four in 10 sector businesses could fail by mid-2021. Only one in five have enough cash flow to survive beyond February under present levels of support.
Chancellor Rishi Sunak last month unveiled a £4.6 billion financial package for the hospitality and leisure sector.
That sum sounds enormous but it is carved up into individual grants of between £4,000 and £9,000 per site, which in many cases doesn’t even cover the cost of keeping premises closed.
The vaccine roll-out is clearly recognised as the route out of this, but the industry is also crying out for some certainty over the help it will actually be given to bounce back from the worst year on record.
The answers to that will come in four weeks’ time when Rishi Sunak unveils his Budget.
So what does he need to do? The two most obvious requirements are a 12-month extension of the 5% VAT reduction – applied right the way across the hospitality supply chain – and a further business rates holiday.
News this week that the government has urged councils not to issue business rates bills this month ahead of the new 2021/22 financial year until after the Budget appears to be a good sign.
There is no shortage of suggestions from the industry about other measures that would assist the recovery – from rebates on Covid-secure equipment that operators have had to purchase and the reintroduction of the Eat Out to Help Out scheme to offsetting VAT owed against losses for 2020-21.
It is increasingly feeling like 3 March will be the date that confirms whether the government is quite content to let thousands more business go to the wall or committed to at least giving them a fighting chance of survival.