On-trade ‘facing collapse’ as more areas enter tier four

23rd December, 2020 by Melita Kiely

The hospitality industry in England is “now facing collapse” and “urgently” needs financial help after the UK government revealed the majority of the country will be placed under tougher tier restrictions from Boxing Day.

Spirits Bottles

UK Hospitality is urging the government to give more financial help to the on-trade to save businesses

On Saturday (19 December), the government announced an additional fourth tier would be added to the previous three-tier Covid-19 restrictions. Tier four means all non-essential shops and hospitality venues must close, with the exception of providing food and drink for takeaways, and people have been ordered to stay at home apart from essential travel, such as work or education.

The measures initially covered large parts of the southeast and east of England, including London, Kent, Buckinghamshire, Berkshire, Portsmouth and Peterborough.

However, due the rapid spread of a new strain of Covid-19, the detection of a second fast-spreading strain, and rising hospital admissions and deaths because of the virus, UK health secretary Matt Hancock announced more areas will face tougher restrictions from Boxing Day (26 December).

Kate Nicholls, chief executive of trade body UK Hospitality, said on Twitter after the announcements were made: “For hospitality, the Boxing Day announcements put the sector into lockdown across the country but the support simply isn’t there to get businesses through what will be a very bleak New Year. Vat and rates extended beyond March now urgently needed.

“With no parts of the country in tier 1 the best any open business can manage is just 15% of normal revenues. Over 95% hospitality closed. 80% by law and the remainder because it [isn’t] possible to trade. It means hospitality has only traded normally for 9 weeks in 2020.

“Industry now facing collapse – with whole country subject to travel restrictions and severe restrictions, it cannot continue to maintain a cash burn of £0.5bn and a loss of £11bn sales in Dec. Support needed to sustain 3rd largest employer and export earner #hospitalitymatters.”

Areas moving into tier four are: Sussex, Oxfordshire, Suffolk, Norfolk, Cambridgeshire, Hampshire, with the exception of the New Forest, and the parts of Essex and Surrey not already in the toughest restrictions.

Areas moving into tier three are: Bristol, Gloucestershire, Somerset, including the North Somerset council area, Swindon, the Isle of Wight, the New Forest and Northamptonshire as well as Cheshire and Warrington.

Meanwhile, Cornwall and Herefordshire will move into tier two.

On Wednesday (23 December), a further 39,237 people in the UK tested positive for Covid-19, a record high. There were also 744 deaths within 28 days of a positive test, according to government figures.

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