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Independent Welsh hospitality businesses call for ‘circuit break’ clarity

Credit: Bar 44

The Welsh Independent Restaurant Collective (WIRC), which represents over 300 registered supporting cafes, pubs and restaurants across Wales, has sent an urgent letter to Welsh Government Ministers asking for clarity on proposals to impose a ‘circuit breaker’ shutdown of hospitality. The letter is co-signed by Brains Brewery and Castell Howell.

The letter highlights that any decision taken by the Welsh Government on whether to enforce the circuit break in Wales will have very direct and profound impacts on thousands of Welsh businesses and jobs, and as such, urgent and immediate support is now essential to their survival.

Natalie Issac of the 44 Group, and one of the founding members of the collective, said:

“The WIRC has previously raised concerns that hospitality businesses have been unduly singled out in the government’s approach to tackling Covid 19, when it remains our firm belief that licensed premises remain safe places for members of the public to meet as long as all guidance and regulations are followed to keep staff and customers safe, and provided there is an effective track and trace system.

 Alistair Darby CEO of Brains Brewery said:

“We welcome the First Minister’s recent comments, and those of the Health Minister, which recognized that there is no significant evidence of transmission emanating from hospitality businesses, yet, a circuit-break shut down of hospitality is now being considered. We have written to Welsh Government to raise our grave and urgent concerns that this will be the death-knell for many in our sector if immediate support is not provided.”

Simon Wright said of Wright’s Food Emporium added:

“We have never tried to second guess the scientific advice and we’ve worked incredibly hard to implement the safety measures agreed with Welsh Government. We must not forget though that it is a Welsh Govt decision to close us and potentially this means the end of many businesses and jobs. Today our employees are asking  – what’s the plan? How will we pay our rent? Will we have jobs to come back to? Is the idea to get the numbers down to a point where we can lift some restrictions on reopening? What’s the support package?

The First Minister needs to be able to answer all of these questions when he makes an announcement,  including how UK wide job support measures will work in Wales. He must directly address businesses and their staff who are currently in a state of great anxiety and explain how they can get through this. That is his responsibility.”

Shavanah Taj, Wales TUC General Secretary said:

“The hospitality industry supports tens of thousands of jobs throughout Wales. We need to do whatever it takes to make sure that these workers are not left unsupported. It’s not just those directly employed by venues who could be left without a wage, but people in a range of jobs, including freelance musicians and artists. The impact this is having on associated industries, like suppliers and taxi drivers for example, cannot be ignored either. Welsh Government has done a great deal to support these workers, including through their Freelancer Fund, but we need to make sure that the impact on all affected workers is considered and mitigated when any new restrictions are introduced, and avoid job losses and business closures at all cost.”

Kathryn Jones Director of Castell Howell Foods added:

“Closure of hospitality businesses has a direct and immediate knock on effect on the supply chain, including businesses like Castell Howell who provide quality jobs for hundreds of people in South West Wales. In order to plan, and to safeguard as many of those jobs as possible, we need absolute clarity from Welsh Government.”

Today, the WIRC’s letter to Welsh Government raises six areas for urgent consideration;

1. The aims, objectives and length of a circuit break

It is not clear to WIRC members what the aim of the circuit break is, and why it may apply to some sectors and not others. The WIRC has asked for absolute clarity on the timeframe for such a ‘circuit break’ stating that if there is no defined end date, or it remains perpetually under review, then employers will have no choice but to make staff permanently redundant.

2. Support for businesses

With each shut down, businesses lose stock, and with reach re-opening they spend significantly on staffing to ensure premises are safe, all the while the fixed costs remain the same. The WIRC expressed concern that the costs of closing and re-opening businesses are not fully understood by the Government.

They also highlight that the new Job Support Scheme does not help most businesses; it encourages moving all staff onto zero hours contracts and paying only for the hours worked. WIRC member businesses estimate that real pay may already be halved for many hospitality workers, and the impact of loss of lost tips should also be considered.

The WIRC has urged the government to announce further support for the sectors affected by circuit break closure at the same time as the announcement is made, stating that uncertainty over support will only fuel further despair amongst business owners, employers and employees.

3. Economic Resilience Fund

The WIRC expressed concern that the forthcoming third phase of the Economic Resilience Fund (which businesses can apply to from 26th October), whilst focused on resilience, recovery and innovation, does not address the immediate needs of survival, now.

4. Christmas

This is a crucial time of year for business. The WIRC has asked for clarity on whether hospitality will be able to trade this year, stating it will be too late to wait until the end of November or December, because businesses need to make their orders, commit to stock and staff and market their seasonal offers. If businesses are unable to trade at Christmas, many will not open again in January.

5. Recovery

The WIRC remains of the view that hospitality and tourism businesses have a crucial role to play in post-Covid economic recovery. It is likely that UK holidays will remain the norm for several years to come. The 300+ member business in the WIRC, and thousands of other businesses across Wales, can make an immediate contribution to employment and the economy once Covid-19 has passed, but only if they are given support to survive now.

6. Communication with hospitality staff

Currently businesses are shouldering the burden of uncertainty over jobs, security and future financial viability without any of the levers that affect this. The WIRC has asked the Welsh Government to provide guidance to employers on what to communicate to their staff.