10,000 pubs still aren’t getting any government support

Robyn Black

Robyn Black

28 April 2020

Despite the new ‘Bounce Back Loan’ scheme announced yesterday, there are still huge gaps in support for pubs, say trade bodies

Chancellor of the Exchequer, Rishi Sunak, launched government-backed ‘Bounce Back Loans’ yesterday, which offer small firms 100% loan guarantees.

Businesses with a turnover of up to £200,000 will be able to borrow up to 25% of their turnover, capped at £50,000, interest-free for 12 months. The new rescue loans come after widespread criticism of the slow up take of emergency bank lending during the coronavirus crisis.

The British Beer and Pubs Association (BBPA) said that while it welcomed support from the government, the current threshold will preclude the majority of pubs. It calls on the government to fully underwrite Business Interruption Loans for all pubs.

The trade association has also reiterated that 10,000 UK pubs have been left with no government grant support at all, as they currently aren’t eligible for the government’s grant scheme because their rateable value is above £51,000.  

‘For many pubs, taking on debt in the form of a loan isn’t even a viable option,’ said Emma McClarkin, chief executive of the BBPA.

‘For those that do take out loans, it’s imperative they are given more time to pay them back to boost their chances of remaining open after covid-19… These pubs are viable businesses, they are the social hub that binds us all together. An investment in pubs now is an investment in the long-term future of communities across the UK. When this crisis is over, the first place many people will want to visit is their pub. Without further, specific support, these pubs and their communities are in jeopardy.’

Chief executive of the Wine & Spirit Trade Association (WSTA), Miles Beale, has also made calls for the government to go further and said that the burden of additional debt is particularly unattractive to businesses in the supply chain who are yet to enjoy government support afforded to other hospitality businesses in the form of grants.

‘It may well be the case that these businesses will be the last to be permitted to re-open, and even when they are allowed to begin trading again, it is likely they will still be forced to operate at reduced capacity or be tightly restricted. This impact will be felt just as much by businesses in the supply chain,’ he explained.

‘The government must recognise that persisting with such a narrow definition of hospitality is harmful - there will be no hospitality sector without the businesses that keep pubs, bars and restaurants stocked.’

The new loan scheme will open for applications next Monday at 9am (4 May 2020).

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