Inbound travel and hospitality leaders expressed anger at the government’s failure to provide sector-specific support despite welcoming the Jobs Support Scheme announced today.
UKhospitality chief executive Kate Nicholls said the government’s tightened Covid restrictrions had dealt the sector a “hammer blow” and said: “Hospitality needs more targeted efforts to support jobs.”
The Meetings Industry Association (MIA) expressed “utter dismay” at the latest measures.
Chancellor Rishi Sunak announced the government will top up the pay of people who return to work from furlough for at least one-third of their normal hours.
Employers must pay the full rate for hours worked and the government and employers share the cost of two-thirds of the ‘missing’ wages, with the remaining third left unpaid.
The Jobs Support Scheme will run for six months from November.
The Chancellor also announced an extension of the 5% VAT rate for tourism and hospitality services until the end of March.
Joss Croft, chief executive of inbound association UKinbound, said: “Today’s announcement will help many tourism businesses and safeguard jobs. However, the desperate needs of British inbound tourism businesses have again been overlooked.
“These businesses have received no visitors since March, can’t pivot to capture domestic business, continue to be excluded from rate relief and grants and, with so few international visitors, won’t benefit from the extension of the VAT reduction. “
Croft said: “The Government’s one-size-fits-all approach doesn’t work and is having a detrimental effect.”
Nicholls agreed, saying: “The announcement of further restrictions was a hammer blow that will inevitably depress trading. It was crucial the Chancellor delivered support that specifically targeted the hospitality sector.
“Almost one million people in our sector are still on furlough. We need the Government to go further, recognising the greater restrictions imposed upon hospitality, and pick up the full cost of unworked hours.”
Nicholls said: “The Chancellor has given us some reason to be positive, but we urge him to engage with the trade on specific measures to keep people in work. We’re still not out of the woods.”
MIA chief executive Jane Longhurst said the government’s measures “have completely disregarded the business meetings and events sector and its £70 billion contribution to the economy”.
She insisted: “Our sector needs targeted measures. The majority of our sector is not able to open. The new Jobs Support Scheme will be of little use to the sector.
“We know 166,000 staff have already been made redundant and those who remain are either on furlough or back operating for venues with very little business.
“Those able to take advantage will have to pay 55% of wages, increasing their losses.”
Longhurst warned: “The lack of support will have a huge knock-on effect on business tourism. Many city hotels, restaurants and suppliers heavily rely on the business generated by business meetings and events.
“The extension of VAT cuts for hospitality and tourism is completely meaningless for our business-to-business sector.
“What we need is targeted support to protect jobs, plus a fixed reopening date that our sector can aim towards.
“Without a radical rethink by government, venues will be closing and more jobs will be lost.”
Lex Butler, chair of the Hotel Booking Agents Association (HBBA) which represents meeting and events booking agencies and venues, added: “The Chancellor’s measures are not enough to provide what agencies, venues and event services suppliers and staff desperately needed to prevent them closing or making thousands more staff redundant.
“We cautiously welcome the Jobs Support Scheme and keeping VAT on hospitality and tourism to 5%.
“But there are too many businesses in our sector facing the prospect of no income until well into 2021. They can’t afford to take out loans or keep staff on, even for reduced hours.
“This is too little to pull them back from the brink.”
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