Labour warns blanket withdrawal of furlough scheme threatens future of high streets and night life

New analysis by the Labour Party reveals over 5,500 pubs and bars have closed in the UK since the Tories entered government in 2010 – one pub or bar every 14 hours.

The number of pubs and bars has fallen in every region and nation of the UK.

Labour is today warning that the Tories risk further closures of pubs and bars, accelerating job losses and damaging high streets and night life across the country, if they press ahead with their blanket withdrawal of the furlough scheme.

Pubs and bars have been hit hard by the coronavirus pandemic and are still operating with severe restrictions, yet the furlough scheme is now being withdrawn from all businesses alike ahead of a hard stop at the end of October.

The British Beer and Pub Association warned in August that over one third of pubs (37%) could not break even in their first month of reopening, whilst one in four pub and breweries said they didn’t think their business was sustainable past March 2021.

Labour is calling for furlough support to be extended and targeted at the industries still under threat, and for business grants underspend to be redeployed as part of a Hospitality and High Street Fightback Fund.

But the decline in pubs and bars is also a symptom of the government’s long-term neglect of the UK’s high streets and local businesses, with footfall down 10% since 2012 and around one in ten high street shops standing empty – even before coronavirus hit.

It also reflects general economic mismanagement, with the Tories presiding over the slowest recovery from recession on record and an unprecedented 12 years of wage stagnation.

Lucy Powell MP, Shadow Minister for Business and Consumers, said:

“Pubs are a vital part of our high streets and social fabric in communities up and down the country. They have been hard hit by the pandemic and Tory indifference and incompetence over many years means that many have gone to the wall.

“Ministers’ blanket approach to ending the furlough further threatens the future of many more.The furlough scheme must be extendedfor hardhit sectors to save jobs now, and a Hospitality and High Street fund so local areas can target support at businesses still in distress.”

Notes to editors:

• Estimates of the number of pubs and bars uses the Inter-Departmental Business Register (IDBR). The IDBR is a comprehensive list of UK businesses used by government for statistical purposes. We define pub and bars as any local unit registered under SIC code 56.302 – ‘Public Houses and Bars.’

Accessed via nomis, August 2020,https://www.nomisweb.co.uk/query/construct/summary.asp?mode=construct&version=0&dataset=141

• There were around 5,535 fewer local units of public houses and bars in the UK in 2019 than in 2010, with falls in every region and nation of the UK.

• Data from the British Retail Consortium (BRC) from before the Covid outbreak found high street footfall fell by 10% between 2012 and 2019.

October 2019, Retail Gazette,https://www.retailgazette.co.uk/blog/2019/10/uk-high-street-footfall-falls-10-last-7-years/

• Data from the BRC also found 10% of shops on the high street were empty this time last year.

August 2019, The Independent,https://www.independent.co.uk/news/business/news/high-street-shops-closed-empty-town-centres-recession-a9052831.html

• The recovery from the financial crisis was the slowest recovery from recession on record

November 2019, The IFS,https://www.ifs.org.uk/publications/14577

May 2020, Average weekly earnings, ONS,https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/averageweeklyearningsingreatbritain/may2020

• A survey of members by the British Beer and Pub Association in August found 37% had not broken even in the first month of reopening, whilst a quarter said they didn’t feel business was sustainably past March 2021

BBPA, August 2021,https://beerandpub.com/2020/08/04/more-than-a-third-of-pubs-cannot-break-even-one-month-after-reopening/