Coronavirus: Hospitality industry in turmoil amid potential new restrictions, 10pm curfew

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The hospitality industry is once again making the headlines amid fears of new restrictions alongside the impact of the 10pm curfew enforced last week.

Westminster is reportedly considering tougher restrictions to clamp down on socialising to avoid the further spread of COVID-19.

READ: Coronavirus: Pubs and restaurants stocks rebound with new restrictions better than feared

The Times revealed ministers are mulling over a social lockdown across Northern England and potentially London, shuttering pubs and restaurants for two weeks and banning people from different households from meeting in any indoor location.

“We don’t want to bring on new restrictions but of course we keep a constant eye on what is going on with the COVID rate,” Junior Health Minister Helen Whately told Sky News. “We were looking at what we might be able to do.”

Curfew issues

Meanwhile, the 10pm curfew enforced last Thursday came under fire after people ended up gathering in the streets or choking up public transport by leaving venues en masse.

At the weekend, senior Tory backbencher Tobias Ellwood told the government to “revisit” the rule while Liberal Democrats deputy leader Daisy Cooper highlighted there is no modelling on its effect by the government’s Scientific Advisory Group for Emergencies (Sage).

Talking about consequences, Revolution Bars (LON:RBG) started a reduction of its estate via a company voluntary arrangement (CVA) in the wake of the new rule, expected to hit trading considerably.

Franco Manca owner Fulham Shore PLC (LON:FUL) said on Monday it does not estimate a material effect on its dine-in business, while Wetherspoons’ (LON:JDW) boss Tim Martin slammed it as a PR stunt last week.

“This vicious economic circle, still likely to be confirmed by a spike in unemployment later in the year, could then affect both consumer spending and sentiment, while at the same time putting further pressure on sectors such as tourism, travel and hospitality, which are already in dire straits given this year’s events,” said Richard Hunter, head of markets at interactive investor.

Concerns all around

On Friday, trade groups British Beer & Pub Association, UKHospitality and the British Institute of Innkeeping said 23% of their members think their businesses will fail by the end of the year without further government support.

The survey was conducted before the new curfew was imposed.

The industry urged ministers to immediately put in place a new sector-specific employment support package and to extend the VAT cut and business rates holiday for the sector.

On Monday, the government applied the curfew rule on bars in the House of Commons after receiving heavy criticism on its exemption.

The venues were initially allowed to sell alcohol even after 10pm on the basis that they are “workplace canteens” and workers could not get food elsewhere.

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