Pub bosses have warned the cost of closure will far outweigh the £1,000 promised by Boris Johnson for establishments unable to open under England’s new restrictions.
Under Tier 2, pubs and restaurants can only serve alcohol alongside a “substantial meal”, while in Tier 3 venues are restricted to offering only takeaway and delivery services.
The Prime Minister announced the one-off payment for establishments which are unable to offer food – so-called “wet” pubs.
But Simon Emeny, the chief executive of brewers Fuller, Smith and Turner, said it would not be enough to save many of those affected.
“A thousand pounds really doesn’t really go any way to solving the financial Armageddon that many individual and independent operators are going to face,” he told BBC Radio 4’s The World at One.
“The challenge for wet-led pubs is if they don’t sell food they will find it impossible to operate, but you have still got bills to pay.
“They have still got to pay potentially rent, insurance costs, national insurance and the apprenticeship levy. That is far more than £1,000.”
The British Beer & Pub Association said that on its own, the sum was “nowhere near enough to stave off thousands of pub closures”.
Mr Johnson told MPs the payment was “recognising how hard they’ve been hit by this virus in what is typically their busiest month”.
The Prime Minister acknowledged that the burden of coronavirus restrictions placed on the hospitality sector had been “disproportionate”.
“We feel this deeply, because our pubs, our hotels, restaurants, they are in many ways the heart of the communities,” he said.
Mike Cherry, the national chairman of the Federation of Small Businesses, said: “Pubs are facing a dark and difficult winter ahead, and ahead of the new restrictions coming into force tomorrow, we need to see action if we are to save the nation’s pubs from collapse.
“Those so-called ‘wet pubs’ that predominantly only sell alcoholic drinks have been left high and dry about how they are going to survive during what should be a normally busy and bustling festive period.”
He said the extra funding would “hardly scratch the surface” and said £4,000 was “a bare minimum if it is going to have any genuine positive impact for the businesses affected”.
Kate Nicholls, chief executive of trade body UKHospitality, warned that 90% of venues would be unviable by the new year as a result of the tiers.
“A one-off payment of £1,000 for pubs forced to close does not even count as a token gesture,” she said.
The Government’s approach “lacked any sliver of logic, as evidenced by the farcical debate around Scotch eggs over the past 24 hours”.
The new tier system “condemns nine out of 10 hospitality businesses to being unviable by the new year” including community pubs, neighbourhood restaurants, independent hotels and nightclubs.
She said: “The Prime Minister himself said that he was asking hospitality to bear a disproportionate burden to allow the reopening of all other parts of the economy and pay for our festive bubbles, but the compensation is derisory.”
£1000 for wet led pubs is derisory. Nothing for breweries which have run (on average) way below 50% of their trade this year is negligent. I despair.
— James Calder (@jmcalder101) December 1, 2020
James Calder, chief executive of the Society of Independent Brewers, also said the £1,000 was a “derisory” amount.
He tweeted: “Nothing for breweries which have run (on average) way below 50% of their trade this year is negligent. I despair.”
Emma McClarkin, chief executive of the British Beer & Pub Association, said the £1,000 payment was a “meagre amount”, with the average pub losing £47,000 in revenue this December.
“It is, quite frankly, an insult to thousands of pubs across the UK that are on their knees,” she said.
“It barely touches the sides of what pubs up and down the country require to cover their costs and ensure they survive.”
She warned that 30,000 pubs were at risk of closing for good without further Government support.
Nick Mackenzie, boss of brewer and pub owner Greene King, said the package announced by the Prime Minister – reportedly costing £40 million – “won’t touch the sides of the financial hole that’s left for pubs over what is traditionally the busiest trading period of the year”.
He warned: “Unless the Government urgently reviews the restrictions, many pubs face permanent closure, which will deprive communities across the country of their much-loved great British pub.”