Mixed reaction from struggling Sunderland hospitality sector to Budget announcement
The already struggling hospitality sector has had a mixed reaction to the budget announcement from Rishi Sunak.
The announcement was watched with a keen eye by the hospitality and arts sectors who’ve been brought to their knees by the pandemic and the subsequent social distancing restrictions.
A number of key areas should help the industry moving forward, however, including the announcement that the 5% reduced rate of VAT for hospitality will be extended for six months to September 30, with Mr Sunak telling MPs “Even then, we won’t go straight back to the 20% rate.”
In addition, alcohol duty will be frozen for a further year.
A “new restart grant” will also be provided in April to help businesses reopen.
Mr Sunak told MPs: “Non-essential retail businesses will open first, so they’ll receive grants of up to £6,000 per premises.
“Hospitality and leisure businesses, including personal care and gyms, will open later, or be more impacted by restrictions when they do, so we’ll give them grants of up to £18,000.
“That’s £5 billion of new grants, on top of the £20 billion we’ve already provided.”
Mr Sunak also confirmed the furlough scheme will be extended until the end of September, and employees will continue to receive 80% of their salary for hours not worked.
Ian Wong of Asiana in West Wear Street says the Budget was mostly positive for hospitality.
"Overall, I feel it is a positive and less doom and gloom as expected of today’s budget,” he said. "The continuation of the reduced VAT is great, I only wish it would extend fully to April next year, allowing us to try and recuperate the massive losses.
"The 5% until September gives less than five months, and that’s providing most venues will be allowed to open on May 17.”
He added: “The £18,000 grant for businesses with rateable value of over 51k will certainly help to re-stick the expired packaged goods that have been disposed of. I feel this should have been the approach from the beginning, however, but it’s still a relief that we are getting something."
Speaking about the furlough scheme, he said: “Furlough until September will give people the peace of mind, rather than ending in a cliff edge and I’m glad to be a part of a country that had the foresight to keep something in the war chest for such matters.”
Harry Collinson, who owns The Looking Glass in the city centre, as well as new business Cafe 1851 in Mackie’s Corner, also welcomed the news.
"It’s very welcome that the VAT reduction is continuing as business rates holiday will help, but it’s disappointing they didn’t give rates holiday for the full year though.”
He said the new restart grants were also a good idea, saying: “It’s really important that local authorities pay this out to all businesses who really need this to help them to survive, as regards paying rents etc.”