This on-again, off-again cy­cle could be the death of pubs

The Daily Telegraph - Business - - Business Comment - Jon Yeo­mans Ben Mar­low is away

The pub in­dus­try can count it­self lucky that new re­stric­tions un­veiled by the Gov­ern­ment are not more se­vere. Pubs have been told to op­er­ate a 10pm cur­few and manda­tory ta­ble ser­vice from to­mor­row. But it could well be a short-lived respite. These feel like stag­ing posts on the road to far more strin­gent mea­sures.

It’s hard to over­state the im­pact of coro­n­avirus on pubs. Even be­fore the pan­demic, the in­dus­try was limp­ing along.

We are all fa­mil­iar with yearly re­ports of how pub num­bers have tum­bled pre­cip­i­tously since the turn of the cen­tury, with an ac­cel­er­a­tion since the 2008 fi­nan­cial cri­sis.

The cul­prits in the steady de­cline of the Bri­tish pub have been many and ne­far­i­ous. The smok­ing ban of 2006 pushed le­gions of dogged cus­tomers and their hack­ing coughs out­side on to scraps of con­crete op­ti­misti­cally la­belled “beer gar­den”.

Su­per­mar­kets and their cheap cans of beer have been an in­de­fati­ga­ble en­emy. As pub mar­gins van­ished, the land they stood on be­came more valu­able, prompt­ing a spate of sell-offs.

Then there is the beer tie, which locks in land­lords to the com­pany that owns their pub. The “pub­cos” have been ac­cused of ramp­ing up rents for ten­ants and set­ting stiff per­for­mance tar­gets. These claims have al­ways been vig­or­ously de­nied by pub­cos; none the less, con­cerns about the sys­tem re­sulted in the Pubs Code of 2017.

All of which is to say that the in­dus­try was in a frag­ile state pre-Covid, more so per­haps than the other sec­tors that have been hard­est hit by the virus – such as travel and the arts, which were at least in com­par­a­tively rude health. But these ear­lier wor­ries are like shot glass-sized aper­i­tifs to the pint-sized drench­ing of Covid.

The pub in­dus­try claims the new cur­few will be “dev­as­tat­ing”, re­mov­ing “a key trad­ing hour”. It is, of course, likely that it will sim­ply bring for­ward the rush for last or­ders. It will be worse for pubs that typ­i­cally close later at week­ends. For many it may prove a tip­ping point.

Some (Wetherspoo­n founder Tim Martin, for ex­am­ple) will ar­gue that the science on Covid’s spread in pubs isn’t clear and there­fore blan­ket clo­sures and cur­fews are too blunt a tool. They miss the point: much of the science still isn’t clear and, in any case, gov­ern­ment de­ci­sions have only par­tially leaned on the science.

Many con­sumers will have al­ready voted with their feet; it is not un­rea­son­able for peo­ple to con­clude that gath­er­ing in an en­closed space talk­ing loudly along­side other tipsy peo­ple isn’t a good idea.

More­over, even the most hard­ened pub lover would strug­gle to jus­tify keep­ing them open and po­ten­tially fur­ther­ing the spread of the virus if the knock-on ef­fect is that schools in the lo­cal area may have to close. Min­is­ters won’t want to be seen pri­ori­tis­ing pubs over schools again.

The in­dus­try shouldn’t be sur­prised to find it­self in the cross­fire. But nei­ther should it be hung out to dry af­ter a muted re­open­ing in July.

Clearly many pubs can­not sur­vive this off-on econ­omy. Like con­stantly flick­ing a light switch, the end re­sult is that the light bulb will pop; so it is with pubs. Those premises that spent a good deal of time and money try­ing to be­come Covid-se­cure will feel rightly ag­grieved that they have been landed in the drink.

The wis­dom of the Chan­cel­lor’s Eat Out to Help Out scheme is now look­ing shaky. Firstly there’s the mixed mes­sage it sends: “Go out! Eat! But now we’re clos­ing the pubs early be­cause you ate out and helped out!”

More im­por­tantly, might the £522m that the Trea­sury flung at the scheme have been bet­ter spent on a func­tion­ing test and trace sys­tem, to en­sure that hospi­tal­ity busi­nesses like pubs were not ex­posed to the dan­ger of a stop-start au­tumn? Or that, if they were, clo­sures could at least be man­aged on a much more lo­calised level?

There’s only so many times a land­lord will pour away his lo­cally sourced ales be­cause of a lock­down be­fore he throws his hands up in de­spair and de­cides this busi­ness is not for him (and it’s worth re­mem­ber­ing wet-led pubs, which serve lit­tle, if any, food, won’t have ben­e­fited from Rishi Su­nak’s half-price din­ners).

In the long, painful de­cline of the pub, there is one last sus­pect to con­sider: the great Bri­tish public it­self. Beer con­sump­tion has been on a down­ward tra­jec­tory as we have be­come more health con­scious. There has been a mi­nor uptick in re­cent years, but this has mostly come from off-trade (at home) drink­ing.

So­ci­ety and cul­ture has changed in many good and im­por­tant ways. Peo­ple want their pubs to be there, but they don’t want to visit them five times a week. The longer not go­ing to the pub be­comes em­bed­ded in our cul­ture, the more at risk they will be. Some of our best-loved pubs will close be­cause of Covid. Oth­ers will be dor­mant for a very long time. A cre­ative few will con­tinue to make it work. In­di­vid­ual pub­li­cans will be left with debts they can­not pay.

When we lose a pub, a lit­tle part of our her­itage and com­mu­nity van­ishes with it. That sort of misty-eyed sen­ti­ment about Bri­tain’s hostel­ries is un­likely to move hearts at the Trea­sury. But cold, hard num­bers might: the sec­tor is worth £23bn and gen­er­ates £13bn for the Ex­che­quer. It em­ploys 600,000 peo­ple and 43pc of them are aged 16 to 24. This is hardly cre­ative de­struc­tion we’re talk­ing about, more the sac­ri­fice of a sec­tor where a level play­ing field has been ploughed un­der.

The Chan­cel­lor has said he wants to get “cre­ative” about help for cer­tain sec­tors. The pub trade, uniquely ex­posed and brit­tle as it is, and an em­ployer of so many young peo­ple who’ve been so wounded by this re­ces­sion, is a good place to start.

‘Ear­lier fears are like shot glass-sized aper­i­tifs to a pint-sized drench­ing from Covid’

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