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UK Government urged to ‘hammer out’ hospitality deal as socialising discouraged

An empty bar in London's Covent Garden called Mr Fogg's Tavern, stores it's chairs inside while it's closed on Thursday morning. A rapid rise in Covid-19 cases has led to a surge in booking cancellations across the hospitality industry. Photo by James Manning/PA

By Amy Gibbons and Geraldine Scott, PA Political Staff

Labour has accused Rishi Sunak of “eating out to help out” in the US while businesses struggle at home.

Wes Streeting said the Chancellor should “get himself on a flight back and get a grip on the situation” amid reports that he is in California on an official trip.

The shadow health secretary urged the Government to “hammer out a deal to help hospitality” as business leaders expressed concerns over calls for people to consider limiting their social contacts around Christmas.

Health minister Gillian Keegan insisted on Thursday that there are still measures in place to help businesses through the pandemic.

But Labour said more support is needed after Professor Chris Whitty told the public on Wednesday to prioritise events that “really matter to them” over the festive period, in an effort to curb the spread of the Omicron variant of Covid-19.

Prime Minister Boris Johnson stopped short of matching England’s chief medical officer’s warning, instead urging people to “think carefully” before attending celebrations.

The news has drawn concern from the hospitality sector as people weigh up whether to risk nights out or cancel their plans to improve their chances of spending Christmas with family.

British Chambers of Commerce president Baroness Ruby McGregor-Smith said on Wednesday that Prof Whitty’s plea “will almost certainly have an enormous impact for businesses”.

“Despite this still we heard no news of any new financial support measures coming from Government to help those businesses, and others badly affected by the current restrictions,” she said.

And the head of Shepherd Neame, which has 320 pubs and hotels, said on Thursday that his business is now in a “zombie world”.

Chief executive Jonathan Neame told Times Radio: “Go to pubs. Don’t go to pubs.

“It was the message last time, which is a really confusing and difficult message, and confuses both the operators but also confuses customers, too.

“Up until this point, I think that people have been mainly concerned not so much for their personal health, but for getting self-isolated and missing their family Christmases.

“That’s been a sort of key driver behind cancellations.

“But I fear now the messaging is changing. And therefore we may see much more acceleration in cancellations.”

He added: “The acute problem is that, if you miss Christmas – and we’re in the zombie world where we’ve been desperately trying to hang on to staff and want to hang on to staff – then what could be very profitable could quickly run into a significant loss.”

Mr Streeting stressed that hospitality businesses are having a “hard time at the moment” and said the Government should be “by their side”.

“I do think the Chancellor and the Business Secretary need to get business leaders around the table with trade union leaders to hammer out a deal to help hospitality because, you know, they really need us right now,” he told ITV’s Good Morning Britain.

He also said Mr Sunak should “get himself on a flight back and get a grip on the situation” after the Daily Mirror reported that the Chancellor is on a four-day official trip to the US to meet leaders from the tech and investment sectors.

He told Times Radio: “We understand the Chancellor is currently out of the country in California.

“So perhaps he might want to get himself on a flight back and get a grip on the situation because businesses need certainty and confidence now.”

And Mr Streeting told Sky News that it is no good for Mr Sunak to be “eating out to help out” in the US while businesses in the UK are struggling.

Meanwhile, Labour has written to Mr Sunak urging him to provide more support for businesses facing “closure by stealth” amid rising coronavirus fears.

“It is time the Government came forward with their plans to ensure our great British businesses and their workers have the clarity and support they need to weather this storm,” it said.

Shadow chief secretary to the Treasury Pat McFadden is due to lodge an urgent question in the Commons on Thursday, asking the Chancellor if he will make a statement on Government support for business given the advice to “de-prioritise social contacts”.

Ms Keegan admitted on LBC that the situation is “terrible” for hospitality after having also suffered last Christmas.

But she insisted there is still support in place for businesses.

She told Sky News: “So we’ve still got VAT reductions, we’ve still got business rate cuts of 66%, and we’ve still got recovery loans in place.”

The health minister also told LBC that she has been forced to cancel a skiing trip over Christmas due to the rising threat of Omicron.

Professor Andrew Hayward, a member of the Scientific Advisory Group for Emergencies (Sage), said a balance has to be found between “the impact on the economy, the impact on people’s social lives and the impact on the virus and subsequent hospitalisations”.

He told BBC Breakfast: “I think the scale of the potential problem that we’re looking at here does mean that we need to bite the bullet and we need to tell people that there’s two really important things here.

“One is to get boosted, the other, if we want to slow it down now… then what we need to do is reduce the number of contacts that we have, we need to avoid crowded spaces with lots of people in and unfortunately, yes, that does mean parties etc.

“And so that’s a difficult message.”

A Treasury spokesperson said: “As we have done throughout the pandemic, we are closely monitoring the impact of the virus on the economy – and particularly the hospitality sector – which is why the Chancellor is meeting with representatives from the industry today.

“Our £400 billion Covid support package will continue to help businesses well into spring next year, and of course we will continue to respond proportionately to the changing path of the virus.

“To keep safeguarding our economic recovery and the lives and livelihoods of the British people, our priority is now to make sure everyone has the opportunity to ‘get boosted now’.”

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