Restaurant and pub bosses hit by a wave of cancellations caused by the spread of the Omicron Covid variant and by warnings to limit social activity have demanded Government support for the sector.
Kate Nicholls, CEO of trade body 海角视频Hospitality, said hospitality sales had already plunged by more than a third over the last 10 days with £2bn of trade already lost in December.
She called for business rates relief and VAT discounts to be extended - while the CBI urged the Government to provide support “in lockstep with future restrictions”.
Tonight the Government confirmed Chancellor Rishi Sunak had held meetings with business and hospitality leaders to discuss the situation.
Read more: Bank of England raises interest rates to 0.25% as inflation soars
England’s chief medical officer Professor Chris Whitty has advised Britons to consider cutting back socialising around Christmas, while Prime Minister Boris Johnson said people should “think carefully” before going out to celebrate.
Ms Nicholls said: “Christmas trade is always crucial for the hospitality industry, making up as much as a quarter of the year’s profit for many businesses.
“Last year, Christmas was cancelled and so much rested on this December period for businesses already staggering under a burden of debt incurred from the pandemic and facing rising costs across the board.
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“If operators are unable to trade profitably over the next month, many will simply not survive – and those that do make it through face a return to 20% VAT in April.
“The Government must step in now and provide measures that support the businesses and jobs in the sector – by committing to keeping VAT at 12.5%, suspending business rates payments for the first quarter of 2022 and reinstating recovery grants.”
Michelin-starred chef Tom Kerridge said one of his restaurants had seen more than 650 cancellations in the past six days due to Omicron fears.
Jonathan Neame, chief executive of pub and brewery Shepherd Neame, told Times Radio: “We’ve seen a significant number of cancellations and that’s accelerating every day, and will accelerate even further after the news last night, which seems to have thrown us back into that sort of zombie world of the first week of March, of the pandemic last year.”
Patrick Dardis, chief executive of the 220-strong pub group Young's, told the PA news agency: “I have no idea where Rishi Sunak is right now but he needs to show up and give the industry his backing.
“There are thousands of businesses – not just pubs – that could collapse in January if the current situation isn’t partnered with proper financial support.
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“We have given up on this being the fantastic Christmas we had hoped, but will obviously continue to do our all for all the customers still with bookings.
“We have seen similar to everyone else. We saw 30%-plus cancellations last week and that’s looking higher this week and next week.
“The industry have spoken with BEIS (Department for Business) in recent days but what we have heard has not been very encouraging to be honest, so hopefully things will change soon.”
Earlier this week, the International Monetary Fund said Chancellor Rishi Sunak should be “ready to deploy” a mini form of furlough support in the event of widespread closures to help sectors suffering the most, such as hospitality.
Rain Newton-Smith, CBI chief economist, added: “Further support for struggling firms will be needed if fresh government public health measures prevent firms trading their way to recovery.
“Cash is king, so helping affected firms with cashflow, by ensuring unspent local authority grants are distributed to firms, giving firms more headroom to manage their coronavirus debt repayments and considering measures to reduce the fixed costs of businesses where demand is severely affected should be on the table.”
Dominic Paul, chief executive of takeaway chain Domino’s Pizza, said parts of the hospitality industry “are going to have a really tough few months”.
He added: “The Government showed a real willingness to support the industry before and I think they probably will again.”
No 10 said some of the companies involved in meetings today were Prezzo, Black Sheep Brewery, Nando’s, Greene King, Whitbread, Adnams, the Confederation of British Industry, the Federation of Small Businesses, British Chambers of Commerce, the Federation of Wholesale Distributors and 海角视频 Hospitality.
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A spokesman for the Prime Minister said: “We have the range of support in place for businesses, but we have had the calls today, given we recognise the difficult position that the hospitality sector are in.”
Earlier, Boris Johnson denied he was imposing a lockdown by stealth and insisted his Government had “kept business going” through the pandemic.
The Prime Minister told broadcasters: “We’ve kept businesses going throughout the crisis with more than £400bn worth of support. We’ll continue to support business with the Covid recovery loans, with business rate reductions, with VAT reductions, and the best thing we can do is make sure that we get back to normality as fast as possible by getting boosted now.”
He added: “We’re offering a package and we already have measures in place, supporting businesses through business rate relief, through VAT reductions, the loans that I’ve described, all that is there, but what we’re also saying is that we want to keep businesses going, keep businesses open, as we have done for a long time now through the vaccination programme, and the best way to get back to normality is to get boosted now.”