Saturday 26 December 2020 / 7:00 AM Lucy Powell

Not such a Merry Christmas as majority of Britain’s pubs and bars miss out on billions in sales – Lucy Powell

Not such a Merry Christmas as majority of Britain’s pubs and bars miss out on billions in sales 

 

  1. Labour warns of ‘last orders’ for pubs as government ‘glass half empty’ approach fails to provide adequate support to closed businesses on the high street
  2. New analysis shows cash crisis facing pubs with an estimated £3.8 billion of lost income in crucial Christmas period 
  3. 36,000 pubs in England have been forced to close – or 9 out of 10 pubs in England
  4. Labour is calling for a Hospitality and High Street Fightback Fund that would boost cash support to pubs and hospitality sector saving jobs and livelihoods 

 

New analysis by the Labour party has revealed that 93 per cent, or 9 out of 10 pubs in England, have been forced to shut and are set to lose out on thousands of pounds in trade over the critical Christmas period.

 

85 per-cent of pubs in England were closed in the run up to Christmas. This number will jump to 93 per-cent – with over 3,000 more pubs closed from (today) Boxing Day after new restrictions came into force across large parts of the country.

 

In November and December last year, pubs and bars across the UK made £3.8 billion in sales to tide them through the first quarter of 2020.

 

The Party is warning that thousands of pubs could go bust as they have seen takings tumble, debt mount up, and cash reserves reduced during the coronavirus crisis. The turnover for pubs and bars to August 2020 was less than half of what it was in 2019.

 

The failure of government to properly support pubs means that three quarters of pubs are receiving up to half the amount of cash support that they received in the first national lockdown. This comes after months of reduced sales and the cost of making themselves Covid-safe pushing many to the brink of bankruptcy.

 

Labour has urged the government to use a portion of the £2 billion in business rate relief that supermarkets have pledged to return to the Treasury to establish a Hospitality and High Streets Fightback Fund targeted at those firms that have been hardest hit throughout the crisis. Labour is calling for the remainder to be used to immediately support self-employed people excluded from support throughout this crisis.

 

The party is also calling for reform of the unfair Additional Restrictions Grant so that funding is allocated to supply chain businesses based on which Tier a local area is in and how long they have been in it, to reflect business need.

 

Lucy Powell MP, Labour’s Shadow Minister for Business and Consumers, said: 

 

“Pubs are a vital part of Britain’s high streets. They bring people together and help communities thrive. They’ve had the toughest of years as a result of the pandemic and, if the government doesn’t step up and put a proper support plan in place to secure their future, it will be last orders for many.

 

“Boris Johnson is failing our pubs. His glass half empty approach is a real threat to their future. Labour is calling on the government to use part of the £2 billion supermarkets are returning to set up a Hospitality and High Streets Fightback Fund to save businesses and jobs now.”

 

Ends 

 

Notes to Editors

 

The number of pubs in each Tier in England

Investigations by the House of Commons library for Lucy Powell MP show the number of pubs in England, regionally and in each local area by rateable value.

 

Using this data, Labour has estimated the number of pubs premises facing restrictions because of the Tiered system.

 

Data before December 23 announcement on Tiers changing

Rateable properties1, by rateable value, by special category,A by local authority, as at 31 March 2020
Tier Attribute Less than 12K 12k to 15k < 15k 15k to 51k 51k+ all
England All pubs 11480 3100 14580 15410 9080 38700
1 All pubs 350 80 430 390 150 990
2 All pubs 4,300 1,190 5490 6110 2940 14260
2 Wet led pubs* 2838 785 3623 4033 1940 9412
3 All pubs 5290 1240 6530 5270 2,900 14,640
4 All pubs 1,540 590 2130 3640 3,090 8,810
England Closed pubs 9668 2615 12283 12943 7930 32862
Proportion of closed pubs in England 85
Proportion of closed pubs receiving less support than March lockdown 77

 

Data for Boxing Day restrictions onwards

Rateable properties1, by rateable value, by special category,A by local authority, as at 31 March 2020
Tier Attribute Less than 12K 12k to 15k < 15k 15k to 51k 51k+ all
England All pubs 11480 3100 14580 15410 9080 38700
1 All pubs 0 0 0 0 0 10
2 All pubs 2590 660 3250 3220 1480 7820
2 Wet led pubs* 1709 436 2145 2125 977 5161
3 All pubs 6300 1,490 7790 6710 3,630 18,040
4 All pubs 2,590 950 3540 5,480 3,970 12,830
England Closed pubs 10599 2876 13475 14315 8577 36031
Proportion of closed pubs in England 93
Proportion of closed pubs receiving less support than March lockdown 77

 

 

*The British Beer and Pub association estimates that two thirds of pubs in England are wet-led, meaning they do not serve food and are closed.

VOA. Non-domestic rating: stock of properties including business floorspace, 2020

https://www.gov.uk/government/news/london-south-essex-and-south-hertfordshire-to-move-to-tier-3-restrictions

1 Rateable property (also known as hereditament) – A unit of property that is, or may become, liable to non-domestic rating and thus appears in a rating list.

A Special category – These are the most detailed description of a property and shows the nature of the use of the rateable property.

Counts are rounded to the nearest 10 with counts of 0 being reported as 0 and counts of fewer than 5 reported as negligible and denoted by ‘-‘

 

Cash crisis facing pubs and bars

Office of National Statistics Monthly Business Survey turnover data shows the turnover of pubs and bars in GB 2019 and 2020 up to figures are available. From this we can estimate the amount of money pubs and bars have missed out on.

 

Monthly business turnover: hospitality service industries
£ billions, current prices,  non-seasonally adjusted, Great Britain
MONTH Pub and bars
  2019 2020 Difference
January 1.58 1.61 0.03
February 1.66 1.63 -0.03
March 1.9 1.14 -0.76
April 1.91 0.06 -1.85
May 1.96 0.04 -1.92
June 1.89 0.07 -1.82
July 1.97 0.91 -1.06
August 2 1.63 -0.37
September 1.75    TOTAL -£7.78
October 1.73    
November 1.69    
December 2.14    
Source: ONS, Monthly Business Survey turnover of services industries, 12 November 2020

 

Business support grant comparison 

  1. In the March lockdown retail, hospitality and leisure businesses received a grant of £25,000. This was one-off support which lasted until businesses were allowed to reopen 15 weeks later. It equated to £1666.67 per week for businesses with a rateable value below £51,000 and £15,000 or more. Businesses with a rateable value of less than £15,000 could claim £10,000 which equated to £666 per week for the same period.
  2. Under the new scheme, retail, hospitality and leisure businesses whose property has a rateable value of £15,000 or more but less than £51,000 (the majority of RHL businesses) can access £2000 every 4 weeks they are closed. This equates to £500 per week. Businesses with a rateable value of less than £15,000 can access £1333 every 4 weeks they are closed equivalent to £333 per week.
  3. The government announced a one-off £1000 for wet-led pubs in December. An average pub (RV between £15-£51,000 for example, would have received a grant worth £6,666 a month during the lockdown in March. After the PM’s announcement, pubs forced to close will now receive £3,000 a month – almost £3,666 less than they did during the first lockdown.

 

Labour’s Hospitality and High Street Fightback Fund

 

Labour has argued that the government should use the money that the UK’s largest supermarkets are returning to the exchequer to support hospitality businesses and excluded individuals that have received inadequate government support so far and could struggle to survive the winter. There is currently more than £2 billion (£2.147 billion) in this fund. Labour has also argued that the one-off £20-a-head funding handed out under the Additional Restrictions Grant is unfair and should be redesigned so that funding is allocated based on which Tier a local area is in and how long they have been in it.