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Small businesses call on government to extend Eat Out to Help Out scheme

Kalila Sangster
·3-min read
A server carries food past a sign promoting the British Government's "Eat out to Help out" COVID-19 scheme to get consumers spending again, outside a restaurant in Manchester, northwest England on August 3, 2020. - Britain's "Eat out to Help out" scheme began Monday, introduced last month by Chancellor Rishi Sunak to help boost the economy claw its way from a historic decline sparked by the coronavirus crisis. (Photo by Oli SCARFF / AFP) (Photo by OLI SCARFF/AFP via Getty Images)
over 35 million discounted meals were claimed across the UK in the first two weeks of the scheme. Photo: Oli Scarff/AFP via Getty Images

The Federation of Small Businesses (FSB) is calling on the government to extend the Eat Out to Help Out scheme to continue to help thousands of small food and drink businesses across the UK recover from the economic impact of the coronavirus pandemic.

The Eat Out to Help Out scheme is due to come to a close at the end of August but the FSB wants the government to continue it for at least one more month, stating that supporting small businesses is “pivotal to our recovery from this recession.”

The scheme, which is backstopped by the government, gives diners a 50% discount at participating restaurants and pubs on Mondays, Tuesdays and Wednesdays throughout August, to a maximum of £10 per head.

According to government data released on Tuesday, over 35 million discounted meals were claimed across the UK in the first two weeks of the scheme.

READ MORE: Business groups urge for an extension to grant schemes

More than 85,000 eateries have signed up to participate, including high-street chains as well as thousands of small independent businesses. More than 48,000 claims were made by participating restaurants in the first two weeks of August.

The first two weeks of the dining scheme also saw the number of people eating in restaurants from Monday to Wednesday increase by an average of 27% year-on-year, according to data from OpenTable.

Hospitality has been one of the hardest hit sectors by the COVID-19 pandemic and subsequent lockdown. About 80% of hospitality firms stopped trading in April, with 1.4 million people in accommodation and food services furloughed, according to the Treasury, the highest of any sector.

“Over the past few weeks, the scheme has been hugely welcomed by small businesses and their customers alike. A nationwide one-month extension would go some way to helping many firms which are still only just about managing in this time of crisis,” said FSB national chair Mike Cherry.

The FSB highlighted that certain groups in the leisure sector, such as pubs, still need additional support. “We need to see these community hubs fully brought into the Eat Out to Help Out fold, particularly as they have been excluded from the recent VAT cut for food,” said Cherry.

Pub chain JD Wetherspoon (JDW.L) suggested the initiative was propping up its business during the pandemic, saying it had seen a “rapid acceleration” of sales since the Eat Out to Help Out scheme was introduced. “Sales have gradually improved, with a rapid acceleration recently, largely due to subsidised food, coffee and soft drinks in the early part of the week,” the company said in a trading update on Monday.

READ MORE: Over 35 million meals claimed in first two weeks of Eat Out to Help Out

The FSB is urging the government to consider extending the scheme beyond September in areas that have experienced local lockdowns or further restrictions. “It’s vital that we continue to offer as much support as possible in areas where restrictions have been reintroduced — this would be a great way of doing just that,” said Cherry.

The FSB is also calling for the scheme to be reintroduced should the economy be further impacted by a second wave of COVID-19. “As we head into the winter and New Year, the government should be conscious of the fact that this scheme is one that genuinely works in helping to get people out into small businesses. The option of reintroducing it should the economy begin to stall should be front of mind,” Cherry added.