0800 644 6080
Call FREE from Landline and Mobile
Est. 1989

Companies ‘Need More Support’ to Cope with Post-Covid Pressures

Written by: Keith Tully

Financial supportBusinesses across the UK will continue to need financial support from the government if they are to stay afloat after Covid restrictions are lifted.

That’s according to the trade body representing hospitality companies, many of which reopened recently after an extended period of closure but are still struggling to operate profitably.

Kate Nicholls, UKHospitality’s chief executive, has made clear her view that hospitality businesses will need substantial financial help from government in the coming months if they are to cope with what she’s called “economic long Covid”.

A major part of the problem for a great many hospitality operators is that they’ve accumulated large amounts of rental debt since the start of the pandemic and are still not able to operate as normal due to Covid restrictions.

Speaking to MPs in Westminster at a recent hearing of the Treasury Select Committee, Ms Nicholls described the current levels of support being given to businesses in her sector as “not sufficient to cover the sustained hit on revenues” they’ve suffered.

“Average hospitality monthly costs are between £10,000 and £20,000, while the average government support is £3,000 per month,” she noted.

Estimates suggest that the hospitality sector may have collectively lost in the region of £87 billion in revenues during the year since the start of the pandemic in March 2020.

As a representative trade body, UKHospitality has been keen to emphasise the potential importance financially to its members of having the government’s roadmap for exiting Covid-19 restrictions be adhered to and not deviated from in the coming weeks.

In that context, June 21st is scheduled to be an important date on which Covid restrictions are set to be lifted and when many thousands of hospitality businesses, including nightclub venues, should be able to reopen after a prolonged period of complete closure.

However, there are rumours and concerns in some quarters that the planned loosening of restrictions from June 21st may need to be delayed due to rising cases of Covid in some communities.

Ms Nicholls told MPs during the recent House of Commons committee hearing that workable solutions will soon need to be found for dealing with the debts that hospitality businesses have accumulated over the course of the coronavirus crisis.

“After re-opening in full, the industry must be given breathing space to gauge customer demand,” she said.

“To achieve this, the government needs to work alongside the sector, landlords and shareholders to find a solution to the £2 billion plus in rent debt that hangs around the neck of the industry.”

Keith Tully

Author
Keith Tully
Partner

Join Keith Tully on Linked In Follow Keith Tully on Twitter

Keith has been involved in Business Rescue since 1992, during which time he’s worked for both independent and national firms. His specialties include company restructuring matters and negotiating with HMRC on his clients behalf.

Meet our Team of Experts
Director Support - Business suffering from Cash-Flow Problems?
If your company is financially distressed, we also offer the below services:
Business debt recovery

  • Recover Unpaid Invoices of £5k+
  • Expert Credit Control Services
  • Stop Late Payers & Bad Debts
Visit Site
Time to pay experts

  • Get Breathing Space with HMRC
  • Support with Business Tax Arrears
  • 35 Years HMRC Negotiation
Visit Site
UK Business Finance

  • Rejected for a CBILS Loan?
  • Get Emergency Business Funding
  • Supporting 1000+ UK Companies
Visit Site
Who we help
  • Company Directors
  • Finance Directors
  • Sole Traders
  • Accountants
  • Small Businesses
  • Large Businesses
  • Partnerships
Contact our team
Jonathan Munnery
Gillian Sayburn
Julie Palmer
Processing...
Loader
or Find your Nearest Office

Here at Real Business Rescue we take your privacy seriously and will only use your personal information to contact you with regards to your enquiry. We will not use your information for marketing purposes. See PRIVACY POLICY

Business Rescue Advice for Directors
Free Guide for Limited Company Directors
Business Rescue Advice for Directors
  • How to manage company cash flow problems
  • Advice on dealing with HMRC
  • Understanding rescue and closure options
  • And much more...
Free Guide Download
Dealing with your Insolvent Clients
Business Rescue Guide for Accountants
Dealing with your Insolvent Clients
  • Helping you advise insolvent clients
  • Spotting signs of client distress
  • Exploring business rescue options
  • And much more...
Free Guide Download
Our numbers speak for themselves
100
Number of UK Offices
30000
Directors Helped
70+
Licensed Insolvency Practitioners