It is a weekend atmosphere in thousands of pubs and restaurants across the UK from Monday to Wednesday, thanks to chancellor Rishi Sunak’s novel scheme that pays 50 per cent of restaurant bills up to a maximum of £10 per person, on food and non-alcoholic drinks.
The scheme, intended to encourage people to eat out and help the struggling restaurant industry hit by the coronavirus pandemic, began on August 3 and runs until the end of the month. The Boris Johnson government has set aside £500 million for the scheme.
In its first week, it has been used 10.5 million times, worth £50 million to the exchequer. Over 83,000 outlets have signed up offer the scheme, including pubs, restaurants, cafes, dining rooms within members’ clubs, and workplace and school canteens.
Participating restaurants include many Indian restaurants. While many outlets have reported ‘berserk business’ during the three days, particularly chains such as Wetherspoons and Wagamama, Indian restaurants in areas such as Southall saw a marginal spike.
Among those struggling are upmarket Indian restaurants in central London, where rents and other fixed costs are high. Indian Accent, which has branches in New Delhi and New York, and opened in Mayfair in 2017, closed due to the pandemic’s adverse effects.
Says celebrity chef Cyrus Todiwala, who has restaurants in central London: “For us, due to our location the scheme has not been great. Our problem is the hesitation of people to avoid public transport, besides the congestion charge to drive into central London”.
“Many London restaurants have complained to the mayor but it is of no use. So if you were to spend £30 to come to us for dinner, why would you? But many love us and take the extra trouble and costs to dine with us”, he adds.
For Manoj Vasaikar of India Zing, Sunak’s scheme has driven business from Monday to Wednesday, but his restaurants have seen a sharp downturn during the weekend.
He says: “We have seen a spike in business from Monday to Wednesday, but we suffer badly on Friday, Saturday. It is the same experience overall in most of the industry, but then the customer benefits, so it is fine”.
Sunak described the scheme’s first-week figures as “amazing”, after official figures showed that 80% of hospitality firms stopped trading in April and that 1.4 million workers were furloughed – the highest proportion in any sector.
“Britons are eating out to help out in big numbers. And they aren’t just getting a great deal – they’re supporting the almost 2 million people employed in this sector,” Sunak said.
Before Sunak rolled out the scheme, Jim Harra, chief executive of revenue and customs, questioned its value for money, writing to him: “By nature, this is a novel scheme meaning there are also particular value for money risks surrounding the level of potential losses that could arise”.
The Guardian called the scheme ‘junk policy’ in an editorial: “As policy…it is glib, gimmicky and, even Mr Sunak admits, a waste of millions of pounds. Junk, then, served up by a politician who should know much better”.
“(His) error is in treating the slump in trade as driven by cost, rather than caution. Discounts and VAT cuts…will not lure out those diners who are worried that they may pick up a lethal virus, or that they may be about to lose their job”.
“Others will take up the government’s offer by enjoying a slap-up meal at a discount on a Wednesday night rather than at full price on a Friday, thus defeating the entire purpose of the policy”, the editorial added.