Sector leaders have called for a clear route out of Tier Three restrictions, supported by targeted financial support.
There were ongoing concerns that the hotels sector was left out of support offered to the wider hospitality sector.
The comments came as Greater Manchester was moved to England's highest tier of coronavirus restrictions from Friday. Under Tier Three rules pubs and bars not serving substantial meals have to close, while household mixing is banned indoors and outdoors in hospitality settings and private gardens.
Reacting to the announcement, UKHospitality CEO Kate Nicholls said: “This is another huge blow for our sector and a very bitter disappointment for hospitality businesses in Manchester. These businesses are either operating under extreme restrictions or closed altogether and this will only increase the pressure.
“We need a practical and workable package of support for the whole of Manchester’s hospitality sector in order to keep these businesses afloat and jobs alive. Jobs, once lost, are not always easily revived and businesses closed not easily reopened.
“Furthermore, there must be a clear roadmap out of Tier Three – a clear set of criteria of what must be achieved to lower the alert level, and what support will be there upon lowering it, so that businesses can do all the planning possible to stay afloat. Job support for those businesses currently in Tier Two must also be much more comprehensive, to help businesses survive and to cushion the transition out of Tier Three.
“The funds already invested to save firms and jobs must not be wasted. There is talk of and accusations that the situation in Manchester had become politicised. It is vital that such an approach is not taken - politics cannot get in the way of addressing the plight of battered businesses and their hardworking staff.”
The reaction followed a study from UKHospitality, the British Institute of Innkeeping and the British Beer & Pub Association, which reported that, with furlough ending and the Job Support Scheme not viable for most hospitality businesses, by February 2021 over 750,000 jobs will be lost against employment figures from February 2020 without further government support.
The trade bodies urged government to urgently rethink the support offered to hospitality businesses across all three tiers, to avoid “unprecedented levels” of unemployment and business failure across the sector.
They called for an immediate, sector-specific extension of the Jobs Support Scheme with no employer contribution until restrictions are lifted for all tiers; Government Disruption Grants should be made available for all venues, across all tiers; and a review of any restrictions placed on venues must take place at least every two weeks.
As reported last week by Hospitality Insights Hotels located in regions deemed Tier Three in the UK will not be able to access the support available to other parts of the hospitality sector.
With hotels still able to legally open, but travel deterred, they are likely to fall through the cracks of the system.
Under the new job support scheme, from 1 November the government will support businesses in the UK that have to close as a result of local or national coronavirus restrictions by paying 67% of the wages of any employees who cannot work (up to a maximum of £2,100 a month).
According to a note released to clients by CMS: “Although most businesses can remain open in these regions for the time being, the prohibition on households mixing indoors may, particularly for many parts of the hospitality sector, mean that staying open is not a viable option. These businesses will not however be covered under the new Job Support Scheme if they close as they are not “legally” required to do so.”
Nicholls confirmed to us that hotels were able to remain open and were not required to close because, as in the lockdown earlier this year, they could choose to house key workers, business travellers, professional sports team and journalists.
Insight: What is startling to the sector is that, for students of GCSE economics, the answer is clear: hospitality makes stacks of cash, keep hospitality going.
But for the government, the matter is more one of preserving cash. You would think it and the private sector would have a lot to talk about on this matter, but the actions of the government seem closer to that of a company, albeit one which has forgotten where its funding comes from.
While the UK government works that out, the IMF warned Rishi Sunak that "now is not yet the time to balance the books”. She added: “Of course, now is a good time to think about balancing the books down the road. But it is more important to make sure that firms and workers are supported while we are still wrestling with the pandemic.”
One feels the message will get through sooner or later - Sunak must appreciate that he’s on the hook for people’s livelihoods either way - but will it be soon enough?
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