The hospitality industry across the UK is staring at banks unwilling to lend money to hospitality businesses that urgently need liquidity.
In the past month hospitality businesses received no income due to closing, following government guidelines.
The reluctance of banks to lend is a major problem, we now learn that some local authorities are delaying grant payments.
Research shows regional divide
New research by the British Beer & Pub Association has revealed that there are many parts of the country where pub businesses are yet to receive grant funding from local authorities to help them survive the Covid-19 crisis.
Local Authorities named and shamed research identifies worst offenders
- Birmingham – 418 pubs – 11% of businesses grants paid
- Nottingham – 222 pubs – 12% of businesses grants paid
- Manchester – 399 pubs – 17% of businesses grants paid
- Brighton – 251 pubs – 22% of businesses grants paid
The UK Government announced its grant support scheme in March.
Pubs and other businesses with rateable values below £15k and £51k would receive grants.
Grants of £10k and £25k respectively to help small businesses through the Covid-19 crisis.
When announced, the BBPA greatly welcomed the grant support offered by the Government.
Grants ‘supposed’ to safeguard thousands of jobs and help closed pubs.
Michael Gove – ‘Pubs last to reopen’
In many areas the system has been slow and sluggish, Local Authorities are not paying grants with the urgency needed.
Michael Gove has said that pubs will be ‘among the last’ to see restrictions relaxed. Making grant support for pubs even more critical.
Local Authorities named and shamed as research identifies mid table poor performers
- Liverpool – 439 pubs – 35% of businesses grants paid
- Sheffield – 421 pubs – 35% of businesses grants paid
- Bradford – 340 pubs – 33% of businesses grants paid
- Central Bedfordshire – 207 pubs – 25% of businesses grants paid
The research identified the Top performers, all deserve enormous praise
The BBPA also found Local Authorities in its research who were exemplary in paying grants to their local businesses including pubs, these were:
- Winchester – 122 pubs – 100% of businesses grants paid
- Redcar and Cleveland – 108 pubs – 98% of businesses grants paid
- Southwark – 198 pubs – 93% of businesses grants paid
- Hyndburn, near Blackburn – 90 pubs – 92% of businesses grants paid
- Southampton – 136 pubs – 87% of businesses grants paid
The BBPA is pressing the Government and those Local Authorities who are not paying grants to pubs.
Pubs in the communities not paying promptly will be forced to close from non or slow grant payment.
Pubs forced to close will see thousands of jobs lost.
Emma McClarkin, Chief Executive of the British Beer & Pub Association, said: “Our research shows that too many Local Authorities are not paying grants to pubs and other hospitality businesses anywhere near quickly enough.
“For smaller pub businesses in particular this grant funding is urgently needed.
“This needs to be rectified immediately. Otherwise, pubs will close for good and the thousands of people they employ will lose jobs.
“Credit must go to those Local Authorities who are doing the right thing and getting their grants to pubs and other businesses quickly.
“We need the Local Authorities to learn from best practice and get the urgently needed support to pub businesses as a matter of urgency.”
The government have been shown by UK banks to have no influence in this crisis. The government’s influence with local authorities is now also in question. Or maybe some local authorities simply do not have the money.
The government is running out of time to deliver.