Excluding furlough and being a long time coming, the Chancellor’s support package for the hospitality sector announcement brings adverse reaction.

Rishi Sunak has finally announced a support package for businesses impacted by the Omicron variant.

The £1bn bailout includes one-off £6,000 grants for pubs and restaurants, which have been hit particularly hard by the new Covid-19 strain.

The Treasury has said an additional £100m will be given to town halls to assist local businesses and the arts sector will be boosted by a £30m injection to the Culture Recovery Fund. It is also reintroducing the Statutory Sick Pay Rebate Scheme, enabling small and medium-sized businesses to claim compensation from the government for the cost of workers’ sick pay.

While the funding announcement has been welcomed, it has provoked anger for its absence of the return of the former furlough scheme, which provided ‘emergency wages’ for employees.

Today’s announcement that pubs and restaurants will receive one-off grants has also been condemned for falling significant short on the financial losses many venues are occurring.

Sharp decline in trade

The trade body, the Night Time Industries Association (NTIA), has been raising the alarm for a couple of weeks over the sharp decline in trade in the industry. The body is also concerned of further restrictions being implemented, which may mean nightclubs are closed entirely ahead of their busiest night – New Year’s Eve.

Michael Kill, chief executive of the NTIA, described the current strategy as “crucifying businesses.”

“At this critical point, we need strong leadership and a clear pathway from government with a long-term strategy for new Covid variants. The open/close strategy is crucifying businesses.

“Every pound of help is much needed. But this package is far too little and borders on the insulting,” said Kill.

As well as claims that it doesn’t go far enough, the Chancellor’s new support package has been criticised for being too long in the waiting.

As Andrew Fisher, a media commentator, tweeted:

“Dithers for days, avoids parliamentary scrutiny, then announces nothing workers – no extension or increase in sick pay, and no furlough scheme to protect workers. Hopeless.”

Unions hit out

Unions have also hit out at the new package.

According to the TUC, the measures are “not conditional on employers keeping workers on and covering their wages” and “do nothing to fix the gaping holes in our sick pay system.

General secretary Frances O’Grady said: “We need a new targeted furlough scheme that covers at least 80% of workers’ wages, and that guarantees that no-one furloughed is paid less than the minimum wage. And we need decent sick pay – paid at the real living wage – available to everyone.”

Earlier this month, Sunak was forced to cut a business trip to California short as Omicron cases soared in the UK and panic gripped the hospitality sector. After jetting back from California, the Chancellor came under fire for failing to act swiftly to provide support to the businesses hit the hardest by the new wave of Covid cases and disruption.

The hospitality sector says that many businesses have lost as much as 40 – 60% of their December trade, which is typically their most profitable time of the year.

Labour criticised the government for not making sure the bailout was on offer when the country switched to ‘Plan B’ Covid measures earlier this month.

Lack of clarity

The government has also come under fire about its “lack of clarity” over lockdown measures and restrictions.

Following a statement after a cabinet meeting yesterday, of which Boris Johnson held off announcing further Covid restrictions claiming the arguments for and against further restrictions were “very, very finely balanced,” Keir Starmer attacked the Prime Minister for a lack of clarity.

“True to form, the Prime Minister has put his party before the public.

“Businesses wonder if they can keep trading, and families are frantic about whether they will see each other this Christmas.

“Today’s lack of clarity is shameful,” said Starmer.

Pat McFadden, shadow chief secretary to the Treasury, referred to Chancellor’s support package announcement as a “holding package from a government caught in a holding position.”

“The real question after yesterday’s indecisive cabinet meeting is what will happen next, when will the country be informed of that, and will support for businesses and workers be placed alongside any further public health measures that might be announced,” McFadden added.

Gabrielle Pickard-Whitehead is a contributing editor to Left Foot Forward.

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