Government urged to hand Tesco rates cash to pubs and breweries

The Government should redistribute the £585 million in business rate relief returned by Tesco to pubs and brewers, according to the Society of Independent Brewers (Siba).

The trade body said the money is desperately needed for the 40,000 pubs and 2,000 breweries that have suffered hardest during the coronavirus crisis and would be equivalent to up to £14,000 each.

Siba chief executive James Calder said: “Supermarkets have thrived during this crisis, but the UK’s pubs and brewers, which are core to their communities, have been left behind.

“Other supermarkets should follow the good example set by Tesco’s, return the relief they didn’t need, and the Government should use the money wisely to give us a chance to see in the new year.”

He also called on the Government to extend the business rates holiday, which only covered retail and hospitality sites, to small breweries.

Mr Calder said: “Small breweries have not had access to business rates holidays or substantial grants; their sales are at rock-bottom and they are running on empty.

“Only recently has Northern Ireland announced plans to extend business rates holidays to small breweries, and the Treasury should follow their lead with that, and more realistic grants.”

Prime Minister Boris Johnson announced plans to offer a one-off payment of £1,000 to wet-led pubs hit by the new restrictions.

But the industry condemned the move.

Coronavirus
Brewers and pubs have been hit particularly hard during lockdown (Jacob King/PA)

Kate Nicholls, chief executive of trade body UKHospitality, said: “A one-off payment of £1,000 for pubs forced to close does not even count as a token gesture.”

The organisation predicts that £7.8 billion of sales could be wiped out with the tier system in place, compared with last December.

In total, the UK’s big supermarkets have received £1.9 billion in business rates relief and grants, but have simultaneously paid shareholders dividends of near equal amounts.

New data from the Market Recovery Monitor, complied by consultancies CGA and AlixPartners, shows that just 2,227 licensed premises – 2% of the total – are located in Tier 1 areas of England, where restrictions are lightest.

A total of 36,648 (39%) are in Tier 3 areas, where hospitality venues must close completely except for takeaways and deliveries.

The rest – 55,502 (59%) – are in the middle ground in Tier 2 and subject to strict limits including a ban on selling alcoholic drinks unless they are served alongside substantial meals.

Following the news that Tesco will repay £585m of grant support to the Government, we have called for the establishment of a Hospitality &Tourism Recovery Fund to support businesses that have not received any grant support and are at risk of closure. https://t.co/I4HupOzRYepic.twitter.com/gKcSdW2jZS

— UKHospitality (@UKHofficial) December 2, 2020

CGA’s research suggests that at least a third of operators in Tier 2 could be unable to trade under these restrictions.

Combined with Tier 3 businesses, it means that more than 50,000 licensed premises in England may not open their doors this week.

AlixPartners managing director Graeme Smith said: “After what has undoubtedly been an ‘annus horribilis’ for the hospitality sector, in normal times we would now be entering the most important four trading weeks of the year.

“However, the overwhelming majority of businesses in this sector are operating under crippling conditions and the Government’s latest offer of additional financial support for wet-led pubs appears unlikely to be sufficient to enable these businesses to survive.”

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