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Rishi Sunak in talks on bailout for pubs and restaurants

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Rishi Sunak will hold talks with business leaders on Friday about a new support package for the hospitality sector after the chief medical officer urged people to scale down their Christmas plans.

The chancellor has cut short a trip to California for discussions on how to bolster the hospitality trade after pubs and restaurants said their Christmas bookings had collapsed as Omicron spread rapidly around the country. The sector said its situation was “dire and deteriorating”.

Ministers are privately furious with Chris Whitty, the chief medical officer for England, who used a Downing Street press conference on Wednesday night to urge people to limit their social contacts after Boris Johnson had said that events should go ahead.

One government source said that Whitty had been “freelancing” and had “thrown a grenade” into the government’s Covid strategy, which had been to encourage people to be cautious but to still go out and enjoy themselves.

Conservative MPs also turned on Whitty, with one government aide suggesting he wanted to transform Britain into a “public health socialist state”. Whitty said it was his job to give advice, as chief medical officers had done since the 1850s.

No 10 backed Whitty as a “hugely respected and trusted public servant” as Johnson denied that he was implementing a “lockdown by stealth”. He said: “We’re not saying that we want to cancel stuff, we’re not locking stuff down, and the fastest route back to normality is to get boosted.”

A record 88,376 new cases of Covid-19 were confirmed on Thursday, while 745,183 booster jabs were administered on Wednesday, 23,000 short of the vaccination programme’s most prolific day.

Sunak, who is facing calls for fresh support from the music and travel industries, held meetings from California with representatives of the hospitality sector. After arriving back in Britain at lunchtime on Friday he will meet more restaurant and pub bosses.

Sunak said that the government had “always stood ready and willing to support the country as required”. His “immediate priority” was to make sure that existing funding given to local councils “gets out the door to those who need it as quickly as possible”. Councils are said to have £250 million which has yet to be spent.

Ministers are examining further contingency plans in which grants could be topped up to help companies to bridge the gap in their revenues over the Christmas period. One government source said the Treasury could commit “several hundred million more” to help companies.

Both ministers and the hospitality industry are highly reluctant to return to furlough measures, though, amid concerns that it will further erode consumer confidence. “This is about seeing businesses through a difficult period,” a government source said. “But it could all look very different in four weeks’ time. We don’t want to overcommit at this stage.”

Travel bosses requested an urgent meeting with Sunak because they believe their sector has been “shut down by stealth”. Businesses that have been in the same families for decades are said to be “limping to their deaths”. Mark Tanzer, the chief executive of Abta, the travel trade association, said that the government had “recognised the plight” of hospitality but that travel “continues to be ignored”.

UKMusic wrote to the chancellor warning that the “lockdown in all but name” was having a “devastating impact” on the sector. In a letter seen by The Times, the industry group said the music business was “in a no man’s land where government advice means we cannot operate viably, yet we have no recourse to support”. It called for “urgent short-term support to businesses to survive winter”, including a return to furlough for affected musicians.

Hospitality companies invited to meet the government on Thursday included Nando’s, Black Sheep Brewery, Greene King, Adnams and Prezzo. Kate Nicholls, chief executive of the industry group UKHospitality, told The Times: “It’s dire and deteriorating on a daily basis. It’s been pretty bad over the past ten days but now it’s fallen off a cliff. You could see trade start to soften when we had the announcement of Omicron. It’s fallen off a cliff since plan B.”

A survey of her organisation’s members found that in the ten days to Tuesday, 50 per cent of Christmas bookings were cancelled and walk-in trade fell by a third on the previous ten days. In central London restaurants, pubs, bars and hotels lost 63 per cent of their revenue and 80 per cent of their bookings.