Pubs and venues warn of 'crippling blow' as public urged to stay away

Tom Belger
Finance and policy reporter
The public have been urged to avoid pubs, restaurants and cafes. (David Cliff/NurPhoto via Getty Images)

Restaurants, pubs and theatres have warned of mass closures and hundreds of thousands of job losses after the UK government urged the public to avoid venues over the coronavirus pandemic.

Prime minister Boris Johnson’s announcement on Monday night was met with fury and disbelief among hospitality leaders.

A growing number of venues from cinemas to cafes are closing their doors, but many remain open. Business leaders are calling for urgent government support to keep firms afloat, and asking landlords for rent holidays. More than 125,000 people had signed a petition within a day demanding a lifeline, while shares in listed pub chains nosedived on Tuesday.

With pressure mounting on the government to support companies who will struggle to pay staff and bills, the chancellor is expected to unveil fresh emergency support on Tuesday.

Read more: UK government set to unveil fresh stimulus for the economy amid coronavirus pandemic

Large numbers of industry chiefs have spoken out from across the hospitality, entertainment, leisure and related industries, including pubs, restaurants, clubs, cafes and theatres, as well as their farming suppliers.

The latest developments include:

  • The British Beer and Pub Association has written to Johnson, warning of an “existential crisis” for pubs and brewers that puts hundreds of thousands of jobs at risk. It wants a six-month freeze on company’s business rates and other tax bills.

  • UKHospitality CEO Kate Nicholls said the new guidance had “effectively shut the hospitality industry,” threatening to wipe out thousands of firms already “on their knees” from plummeting sales.

  • Pub stocks dived as the news spooked investors. Wetherspoon’s (JDW.L) sank 11.5%, Marston’s (MARS.L) fell 14.1% and the City Pub Group (CPC.L) fell 14.6%. The City Pub Group also announced cuts in staffing, opening hours and director salaries, and is asking landlords for rent holidays.

  • Food critic Jay Rayner said not ordering closures was “staggeringly reckless” as it could prevent firms claiming insurance, accusing the government of thinking “more about big finance than people’s livelihoods.”

  • Caroline Norbury, chief executive of the Creative Industries Federation and Creative England, called the announcement a “crippling blow,” with creative firms facing huge losses but no insurance payouts.

  • Greater Manchester’s night-time economy chief Sacha Lord, said the guidance would prove “devastating” to bars and clubs, with the UK one of the only countries not to give a specific timeframe for the measures. He urged firms to step up takeaways, deliveries, gift cards and future bookings where possible.

  • Venues now face difficult choices about whether to close, with many still open but other shutting up shop. Pret A Manger said stores would stay open, but Odeon announced cinemas would close “until further notice.”

Read more: Pret A Manger bans re-usable cups but vows to remain open

It comes after Johnson used his press conference on Monday to urge the public to avoid all non-essential contacts and travel. People should stay away from pubs, clubs, theatres and “other such social venues,” he said.

The government made the drastic proposals in a bid to curb the spread of the virus, after its scientific advisers warned a failure to do so risked 250,000 deaths.

The chancellor is expected to set out new emergency measures at the next of the government’s daily briefings on Tuesday.

Uncertainty hangs over firms’ ability to claim insurance payments. Despite firms’ anger at the government, the Association of British Insurers said on Twitter on Tuesday the “vast majority” would not be able to claim even if the government had ordered firms to shut.

But Rayner disputed their comments, and said anger was more a “howl at the government for issuing an industry-killing instruction without offering any support.”