UK tier system: How badly will it impact the pubs?

  • November 27, 2020 10:38 AM GMT
  • Hina Chowdhary
    Director, Equities Research Hina Chowdhary
    1466 Posts

    Hina Chowdhary is the Director, Equity Research at Kalkine and has an extensive experience of about 15 years in the area of Research, which includes 5+ years in Equities Research particularly.She has earned a Master of Science degree from the renowne...

UK tier system: How badly will it impact the pubs?

Summary

  • The new tier system will be replacing the second lockdown in England next week.
  • PM Boris Johnson has unveiled the arrangements for Christmas in the UK allowing the families to celebrate together.
  • Though retail stands to benefit from the new set of rules, hospitality sector seems to be in danger.

 

The UK will see a new three-tier system from 3 December after the second lockdown is over. The tiered system will see reopening of non-essential shops across England with the festive season in the offing. A five-day period from 23 to 27 December will also allow up to three households to mix with each other and form what PM Boris Johnson has termed as a temporary ‘Christmas bubble’. 

The British pubs and restaurants belonging to the worst-affected areas would be following the strictest tier-3 restrictions and shall remain closed, only permitting online deliveries and takeaways. The “rule of six” will make a comeback in outdoor public places and areas such as gyms, leisure companies, personal care, shops, and outdoor sports venues will be allowed to open. 

Must Read: Covid Christmas rules: how will they impact British hospitality and retail?

Tier-Wise Restrictions on Bars and Pubs 

Tier-1

In these areas, bars and pubs will be allowed to remain open till 11 PM and can only take orders till 10 PM. Venue has to be table service only. 

Tier-2

In these areas the bars and pubs will be closed. They will be granted an authorization only to operate as restaurants. The venues will be permitted to serve alcohol with a ‘substantial meal’ up to 11 PM and can take orders only till 10 PM. 

Tier-3  

This will see strictest restrictions in comparison with other zones. Hospitality venues will be fully closed and can only operate for online deliveries, drivethroughs, or takeaways. 

No hope in sight 

The hospitality sector has seriously condemned the decision to call for a new tier system of restrictions to replace the lockdown. The industry, which has already been under strict restrictions for more than six months, will have to follow stringent rules as most restaurants and pubs are under tier 2 or tier 3. Besides, a lack of financial support has aggravated the struggles of the hospitality businesses in the nation.

The additional restrictions will be devastating for the sector, said Emma McClarkin, the chief executive of the British Beer & Pub Association. Though the plan is currently under review, the 10PM relaxation will be meaningless if most pubs are forced to shut down under tier-2 and 3 rules. 

Pubs and restaurants which do not serve meals will effectively get closed in tier-2 areas. Of the total of 47,000 pubs in the UK, two-thirds of them are “wet-led” businesses that sell primarily drinks rather than food, according to BBPA. 

Mark Derry, executive chairman of Brasserie Bar Co, said that after coming out of this lockdown, the bars and pubs will be in an even worse set of restrictions than before. 

Paul Crossman, owner of pubs in York, said that his pubs would remain closed under both tiers 2 and 3 areas as they don’t serve substantial meals. The main reason that could kill these businesses is a fixed overhead cost. 

Victoria MacDonald, the owner of the Cellar House pub and the Old Ram Coaching Inn in Norfolk, said that the government should have considered opening the bars and trusted that the sector can securely function and avoid any further spread of the virus.

Do Have A Look: Hospitality Sector’s Call For Ending 10 PM Curfew Gain Momentum With New Data

 


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