The Government’s message for the coming winter, delivered on 14 September by both Prime Minister Boris Johnson and Health Secretary Sajid Javid, is that COVID still remains a potential danger.
One immediate potential problem for the hospitality industry was lifted when, despite several ministers saying in the days before that the introduction of so-called vaccine passports was inevitable, their use in England was ruled out. Although they would initially have only applied to nightclubs and large events, their extension to pubs was always a possibility.
Although the number of COVID cases is currently increasing, so long as the health service does not come under pressure, restrictions should not be imposed again on pubs and the wider hospitality industry. According to the Daily Telegraph, sources close to the Prime Minister say that he is ‘adamant’ and ‘dead set’ against further lockdowns. That said, the legal powers created to deal with COVID under the Public Health Act still remain available for use at immediate notice.
FINANCIAL MATTERS
There appears to have been no progress with the Government’s planned legislation to deal with the problem of rent arrears. The present situation is that although the moratorium on evictions for commercial rent arrears runs until March 2022, winding up petitions for rent debts will be allowed from 1 October. All of the big pub owning businesses appear to be going their own way, with several insisting on full rent as from 19 July, when restrictions were lifted.
Furlough, properly the Coronavirus Job Retention Scheme, ends on 30 September. It will be interesting to see if this helps with the staff shortages that some pub companies are experiencing. During July, the hospitality industry saw the largest reduction in the number of people on furlough from any sector, falling from 355,800 to 259,100.
As previously reported, VAT rises from 5% to 12.5% from 1 October and then returns to the current full rate of 20% from 1 April. Similarly, business rates became payable at a reduced rate from 1 July, depending on whether the business was trading again. They also return to the full rate as from 1 April and there is no news of the promised reform of the business rates system.
Some self-employed publicans were able to claim grants under the Self-employed Income Support Scheme but this also ended on 30 September. The Government’s grant schemes, the Coronavirus Business Interruption Loan Scheme and the Coronavirus Large Business Interruption Loan Scheme, closed on 31 March. The Recovery Loan Scheme remains open until 31 December.