Money for Closed Hotels but No Support for Hospitality Sector

As the gov unveils another round of salary support for businesses in the travel and tourism sector, hospitality business owners are still seeking gov support.

The latest round of salary support covers the period April 25 to May 23 for businesses which can demonstrate a reduction in revenue of at least 25 per cent due to Covid-19 restrictions.

However, speaking to gef, three owners of businesses in the hospitality trade said they completely understand the need to support hotels, but that restaurants, pubs and bars have been left behind.

Cyclical Problems

MaryBeth Coll, owner of Foraging Vintners, said the hospitality industry ‘is going to be impacted for the next 18-24 months’ in waves due to the peak and trough cyclical nature of the economy and ‘the future mutations of virus that will impact consumer confidence’.

Ian Swindells and MaryBeth Coll Foraging Vintners

MaryBeth added: ‘For some reason the Gov accepts that tourism and hotel accommodation providers have yearly cycles but ignore the fact that hospitality too has severe cyclical problems and areas outside of Douglas especially are hit hard by the hyper-seasonality of the economy. We need support schemes year round to handle the peaks and troughs of the economy.  

‘Gov is not able to supply us with year round tourism which many operators are at Zero or 5% VAT thresholds-  however hospitality is expected to carry a 20% burden all year even when tourist numbers are low. The VAT, consistent Gov increases, inflation and expensive power costs, place the hospitality businesses which operate on thin margins and rely on volume trade in an impossible situation.’

Doesn’t Touch the Sides

Rikki Dunnage, co-owner of The Front Porch, told Gef that the year or so since the pandemic began has been ‘tough for trade’. 

Rikki Dunnage with business partner Edward Cox

He added: ‘The Free houses such as ourselves have benefitted from a couple of one off payment grants plus salary support but to be honest with stock losses, daily running costs, existing supplier bills who gave no grace to be paid and keeping staff in their jobs this really doesn’t touch the sides.

‘With the first lockdown came a condition that landlords couldn’t evict their commercial tenants which helped as we could agree a payment plan for the rent missed (still racking up a big debt to pay back mind!), nothing like this was in place for the second two, and over £4,000 a month in Douglas just in rent alone to find means the £1,500 grant just wasn’t enough. On top of two cancelled TT and Manx GP festivals, our trade’s busiest weeks of the year, it all adds up with no further support in sight.

‘I speak for the whole industry. We could have done with more support, and owning a newly opened bar with a travel agent on a personal level, the last 15 months could not have been harder.’

On Our Knees

A third hospitality business owner who spoke to Gef said they wanted to see the gov remove the 25% requirement when the industry has been forced to close for over 40% of the past year. 

They added: ‘Our businesses are not run on a month to month basis, and we have to look at figures across the year to get a clear picture. We are being forced to operate a hand to mouth approach.

‘Tourism is an important part of our island’s economy. However, nobody would come to visit without the services the wider hospitality sector provides. By contrast tourism has received a huge amount of support both in terms of continued SS and strategic capacity schemes. There are rumblings about additional support to specific operators that whilst unconfirmed, are troubling all the same.

‘To reiterate, I do not think the tourism sector should not continue receiving SS, but something has to be done to level the playing field. Our sector is on it’s knees and we need support now.’

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