London lockdown: Tier 2 restrictions the ‘death knell’ for hospitality sector
The government’s announcement that London will be placed under a Tier 2 lockdown this week is the “death knell” for the capital’s struggling hospitality sector, industry bodies have warned.
Care minister Helen Whately told London MPs this morning that the city will move from Tier 1 to Tier 2 on Friday night.
The new restrictions mean separate households will no longer be able to meet indoors.
Pubs and restaurants will be allowed to stay open, but the reduction in group sizes will have a knock on effect on the hospitality sector, experts said.
Speaking just hours before restrictions were confirmed UK Hospitality chief executive Kate Nicholls said the new rules could “well be the death knell for many hospitality businesses”.
She said a move into Tier 2 wipes a further 15 per cent off very low revenues, which are currently at 20 to 30 per cent of normal levels in London.
Many will not recover if London moves into Tier 3 lockdown restrictions, which would force pubs to close, Nicholls said.
“Support measures urgently needed to avoid mass redundancies,” she added.
Robert Hayton, head of UK property tax at real estate adviser Altus Group, agreed.
“Further restrictive measures which adversely impacts trade, already at far lower levels than before the pandemic, without any discerning targeted support, could be the death knell,” he said.
The measures will effect 3,640 pubs and 7,556 restaurants across London, Altus said, according to analysis of official government data.
Richard Burge, chief executive of the London Chamber of Commerce, said central London will be particularly impacted by the lockdown as people reduce public transport use.
“With no non-household mixing allowed indoors and a reduction in journeys on public transport requested, Tier 2 will hit London’s hospitality sector hard, particularly in its centre,” he said.
“There is bound to also be an impact on retail.
“Hospitality businesses are between the rock and hard place. Their trade is impacted by the restrictions, yet there’s not sufficient support available to help them to stay open.
“Many would rather be in a Tier 3 area, as at least if they were required to close by law they would be able to access grants and the more generous furlough scheme.”