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Furlough extension ‘not enough to keep hospitality alive’

Trade body UK Hospitality has welcomed UK chancellor Rishi Sunak’s extension of the Coronavirus Job Retention Scheme until March but warned that more support is needed to ensure businesses survive.

Keeping jobs alive during the lockdown is key to the survival of the sector, according to UK Hospitality’s Kate Nicholls

The furlough scheme has been extended a number of times this year. It was most recently extended until December to coincide with England’s second lockdown, which saw bars and non-essential businesses close yesterday (5 November) for four weeks. The furlough scheme was due to end in October and be replaced with a less generous arrangement from 1 November.

In an announcement yesterday, Sunak confirmed the furlough scheme will now be extended until March 2021. Under the scheme, employees will be paid 80% of their current salary for hours not worked, up to a maximum of £2,500 (US$3,230), by the UK government.

Trade body UK Hospitality said the extension of the scheme is a “big boost” for the industry and will help to maintain jobs in the medium term. However, the trade association warned that a “broader package of support” is needed.

Kate Nicholls, UK Hospitality chief executive, said: “Keeping jobs alive during this lockdown and throughout a bleak-looking winter period, which is likely to see businesses trading under severe restrictions, is key to the future survival of the sector.

“Hospitality is facing a tough winter ahead, though, and businesses will need additional support if they are to survive. We will need enhanced grant support to keep venues alive and a solution to the ongoing rent debt problem that continues to linger over the sector.

“These must come alongside a clear roadmap for a return to business. Without these, the extended furlough scheme alone is not enough to keep hospitality alive and will have been a wasted investment of public funds.”

Nicholls also called for an extension of the VAT cut and the business rate holiday, along with more promotion for tourism and hospitality from the government, described as the “bare minimum required” to help the industry.

Earlier this week, the UK government reversed its decision to prohibit on-trade venues across England from offering takeaway alcohol under new lockdown rules.

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