The Scottish Hospitality Group (SHG) became the newest and loudest voice for Scotland’s hospitality businesses when it was formed in autumn 2020, like campaigning for the removal of the music ban and running a petition that 23,500 people signed in one month. It supported, campaigned and stood shoulder to shoulder with other trade organisations for the continuation of the rates relief for a further year and to keep VAT at 5%. SHG also put together a survey and presented it to government showing the actual cost of opening and closing – and the losses that businesses were making every week, even with the grants.
Here, spokesperson Stephen Montgomery gives his personal take on the last 17 months.
To say that the last 17 months have been a long road, with twists and turns and potholes would be an understatement. Not just for hospitality, but for our supply chain, and our customers too. Who would have thought that when the UK Prime Minister stood before the tv camera on 20th March 2020, we would be dealing with COVID-19 for so long? I know I certainly didn’t. As the days went by and they turned into weeks, then months, we were then confronted with the realisation that this wasn’t a short-term issue. It is hard to put into words the feelings about what has happened to our beloved sector during this time.
The loss of businesses who have permanently closed their doors whether through bankruptcy or through not being able to see any way through this, and the devastation caused to long standing family businesses amongst many, and some that had only literally been open a short time doesn’t bear thinking about. At this point I must pay a heartfelt tribute to all our staff who have stuck by their employers right the way through the pandemic, which saw us open and close so many times, and not knowing when the next curfew, restriction or lockdown would happen.
From the nonsensical music ban, curfews, and other restrictions put upon us, we have turned our entrepreneurial skills into doing other things, like helping our communities, cooking and delivering food, our chefs working in soup kitchens for the homeless, our staff volunteering to help at covid test centres, delivering shopping to the vulnerable, and although we never seek to be praised, we have always shown that without doubt, we are part of the solution, not the problem.
Monday 9th August will be a memorable date for many, as we have left level zero behind, hopefully for good, and entered a new phase, life after zero. With it will come new challenges, and we still see some mandatory things which we still need to deal with, like the wearing of face coverings, and the challenges that brings with it, as England and Wales drop the need for these in a hospitality setting. We hope that Scotland will move to a more personal choice rather than mandatory in the very near future.
As we look to leave one pandemic behind, we enter another. We face a long uphill battle with regards to staff shortage, recruitment, debt, and the ongoing pingdemic. All of which have a catastrophic impact on a sector already on its knees.
So, what can we do about it?
We need to start and rebuild from the bottom. Dissect the issues around recruitment and staff shortage one by one and realise that things cannot be like they used to be. Hospitality is a fantastic career, and one that can take you all over the world. We need to promote it and bury the myths that surround it such as a low wage, long hours career. We need to revisit our employer’s handbook, revisit policies on the wellbeing of staff, their work/life balance, and make them know that they are respected, well thought of, and a stakeholder of the business.
We need to embrace their thoughts. When you see the advert on TV for the army, you don’t hear them saying that when you join the army you will end up in a war or lying in the ditches waiting on the enemy……no, you see them promote a career, a skill, a trade, and this is exactly what we need to do. Investing time in our staff with training must be a good starting point. Getting into schools to speak to children at a younger age is key.
Showing them the vast array of areas within hospitality other than the thought of kitchen, serve drinks or wait on tables. What about HR, accounts, media, the list goes on. Talking to parents, many of which will have done a spell in hospitality in their younger days. Getting our older people back into hospitality and retraining their skills. These are all things which we need to be looking at. Remember, we are the last show in town. We all must realise that yes, there are the scrupulous employers out there, they are in every sector, not just hospitality, and they need to deal with their issues if we are to move forward.
Debt is a major issue for many SMEs now. The average site is in approx £90k of debt made up from BBLs, HMRC deferred payments and creditors. Many will have a lot more with rent arrears. Only this week, SHG had a meeting with Scottish Government and Scottish Enterprise to discuss how we look to fund short term debt such as HMRC into long term. This is something which needs addressed urgently before many more well-respected businesses fall off the edge of the cliff forever. Banks are already asking for forecasts to readdress business debt, and how it will be funded. Many will return to the days of the bad bank, and many will call up bank debt with businesses having no way to pay, leaving only one option available, selling the asset to repay the debt, and leaving the owner with nothing.
The issues we are facing now, are just as bad if not worse than the last 17 months. To get us through this, we can only do it with the help of both the Scottish Government and the UK Government. Keeping VAT at 5% permanently would be a welcoming start from Westminster, and doing something beneficial for our wet pubs. Scottish Government need to look now at the rates issue for 2022/23, as these will be set on the 2016 tone date, and nobody can afford that, so the answer must be a further 1 or 2 years rates exemption. We do not need to hear the political jargon of “we gave full rates relief England didn’t”. What we need to hear is “let’s talk and discuss this now” rather than scrambling for the fire extinguisher at the last minute again. We still face a long recovery, and we certainly hope that the issues around the deposit return scheme will be put on hold as we try to work through the recovery period.
Planning, Preparation and Execution are key components to our future. Scottish Government really need to set out a plan now for what happens through the winter months and beyond “if” (and we all hope not) there becomes a need for any form of restrictions to be revisited. We cannot leave this to the last minute. Sector specific support will be needed. How this is funded is down to government, but as always SHG will be willing to help work through this and give ideas to the “think tank” just as we have been right the way through this.
In closing I would like to say a big thank you to the many friends I have made in the last 17 months, my fantastic colleagues within SHG, officials and Ministers across all parties within Scottish and UK Governments, and to colleagues within the other trade bodies. We have worked so hard to get to where we are today, but there is still much to do in the next few years ahead
See you all at the Scottish Bar & Pub Awards on 7th September, the first real chance we have all had to get glammed up and socialise together.
Stephen Montgomery