UKHospitality has called on the government to extend its support for businesses affected by the ongoing pandemic.
Speaking to the House of Commons Treasury Committee, UKHospitality CEO, Kate Nicholls, gave evidence outlining the problems being faced by hospitality businesses hit by the nationwide lockdown.
Nicholls highlighted the areas where government support was “not having the intended effect of supporting businesses”, with many businesses allegedly struggling to access support. She also highlighted the need for business support to continue post-lockdown to ensure the industry can survive.
Despite an extension to the Coronavirus Job Retention Scheme, the trade group estimated between 350,000 and 500,000 hospitality workers do not have access to support, including new starters, seasonal workers and those unable to produce a payslip.
UKH also claimed that hospitality businesses have been “frustrated” by the loan scheme.
A survey published by the group showed that 50% of businesses had applied for a loan but only 18% of applicants secured one, with 58% of applicants still waiting for a response.
The group also argued that 71% of hospitality businesses were ineligible for the government’s grant scheme due to having a rateable value of above £51,000.
Nicholls also warned the government that “serious damage” to the sector should be expected when rents are next due without an extended moratorium. She said that businesses also required a “lead time” after reopening before rent is repaid.
Nonetheless, UKH told the government it is “confident” the sector can return to near full strength if it is supported on rents through moratoriums.
Nicholls said: “It is clear that too many businesses are struggling to access support and that the schemes in place must be extended and enhanced.
“Hospitality was the first sector to be hit hard by the crisis and it will be one of the last to make a recovery. Even when lockdown measures are lifted, our sector faces a huge challenge in getting customers back through their doors and finding solutions to social distancing measures that are likely to be in place.”
She added: “Business support needs to be boosted immediately to make sure that every business that needs it can access it. Scrapping thresholds for grants and support with rents will keep businesses alive and keep jobs open.
“This support then needs to be carried over after the worst of the crisis has passed. If it is abruptly switched off, then all the good work that has been done during these difficult weeks will be undone.”
She concluded that the sector would be battling the effects of the pandemic “for months, if not years” and that government support cannot be stopped “until businesses are back up to full strength”.