Government support for leisure, hospitality and tourism businesses

The leisure, hospitality and tourism industry has been significantly impacted by the latest rise in COVID-19 cases. Although no official restrictions have been put in place by the Government, the increase in COVID-19 cases and threat of the Omicron variant have caused a significant reduction in footfall and a deluge of cancellations as customers look to protect themselves ahead of the Christmas period.

For businesses within the leisure, hospitality and tourism sector the Christmas period is often critical to their survival, with Christmas celebrations providing a welcome boost to income in the winter months. With some businesses reporting a reduction in trade of up to 60%, it has certainly provided an additional and unwelcome challenge on the back of what has been a turbulent 21 months or so for the industry.

On Tuesday 21 December 2021, Rishi Sunak announced a £1 billion fund to help businesses hit by the rise in COVID cases.

Businesses within the leisure, hospitality and tourism sector will be the main beneficiaries of the fund. Pubs, restaurants, cinemas and theatres can apply for a grant of up to £6,000 for each of their premises, which will be provided via local councils and is estimated to cost the Government up to £683 million.

In addition, for employers with fewer than 250 employees, the Statutory Sick Pay Rebate Scheme is being re-introduced so that employers can claim back the cost of paying sick pay to employees who are affected by COVID.

Mr Sunak described the fund as ‘generous’; time will tell whether he’s correct or whether further support measures will be required in the new year.

The VAT rate reduction from 20% to 5% on many aspects of accommodation, food, drink (excluding alcohol) and attractions increased from 5% to 12.5% on 1 October 2021 and is due to revert back to 20% on 1 April 2022, but an extension to this could provide some respite to the industry and surely must be one of the many things under consideration.

Need help?

If you have any questions on the above schemes, please get in touch with your usual contact. You can find contact details in the Our People section of the website. Alternatively, call 0330 024 0888 or email enquiry@larking-gowen.co.uk

Martin Sanders