A leading figure in Scottish hospitality has warned of “untold damage” being caused to the economy by a lack of political support and sympathy for the industry during the pandemic.
Nic Wood also revealed his personal anguish at seeing his business, Signature Pubs, slide into the red during its last financial year after the coronavirus wiped out trade.
And in a swipe at fans being allowed to gather, sing and celebrate in large numbers – often with no face coverings – during the Euro 2020 football tournament, he said: “If any of this happened in hospitality venues, the police would be in like a shot and the place would be closed down. Parents can’t even watch their kids playing school football.”
Scotland’s third largest industry – in terms of employment – is an “easy scapegoat” in the Covid-19 crisis and being treated with “an iron fist”, he claimed.
Pubs and restaurants were forced to shut and, despite a recent reopening for some as Covid restrictions have eased, after office hours patronage continues to suffer due to so many people working from home.
“It’s hard to keep motivated”, Mr Wood said, adding: “We need to get more people back into offices so we can get back to some normality.
“The past year has cost us a huge amount but I’m pretty optimistic we can get the business back to where it was.”
Signature has 21 hospitality venues in its portfolio, including a hotel in the Scottish capital, spread between Aberdeen, Edinburgh, Glasgow, Dundee, Stirling and St Andrews. Five remain shut because Covid restrictions make trading impossible.
Two of the three Aberdeen sites, The Spiritualist, on Langstane Place, and Paramount Bar, on Bon Accord Street, are now trading again but the Nox nightclub, on Justice Mill Lane, is a hospitality industry casualty of the pandemic, forced to shut permanently.
Mr Wood, the eldest son of billionaire oil and gas veteran Sir Ian Wood, is playing a leading role in the Scottish Hospitality Group (SHG), which was set up in response to the pandemic.
SHG has lobbied hard for more government support during the past 12 months or so, but, according to Mr Wood, the politicians haven’t been listening.
The 47-year-old added: “We weren’t lying when we said we were losing a lot of money.
“What we have given by way of grants does not cover what we have lost – it’s not nearly enough.”
The UK Government furloughing scheme has covered wages but not National Insurance, pension and holiday contributions, he said.
A variety of other overheads, including rent and ongoing supplies, have still had to be paid for every month despite businesses having seen their income evaporate, he added.
The focus has all been on keeping firms afloat, with no chance to plan for the future, he said, adding: “We generally reinvest everything we make and would normally be looking for the site of our next place to purchase – or that next pub to do up.
“It will be a long time before we can move forward again to the stage where we have money coming into the business.”
We weren’t lying when we said we were losing a lot of money.”
Nic Wood
Urging the Scottish Government to “sit up and pay attention” to the sector’s plight, he warned that much of the industry was “not going to come out the other side of this”.
He added: “If they (government) don’t help and support businesses, there will be none left to pay tax, rates and all the things we need to move the economy forward.”
Those firms that do survive the pandemic will be “heavily in debt for such a long time”, he said, adding: “This will do untold damage to the economy.”
Edinburgh-based Signature was forced to lay off 40 people in May 2020 and a combination of Covid-19 and Brexit has led to many more not returning after furlough.
The company now employs about 500 people, compared with around 700 in March last year.
Mr Wood warned of likely skills shortages in the industry’s recovery phase. A way must be found to encourage the return of migrant workers who have gone back to their own countries since Brexit, he said.
He also called for a new drive to make careers in hospitality more appealing to young people who see jobs in the sector as “beer money before university”.
Accounts just lodged at Companies House show Signature suffered pre-tax losses of more than £2.5 million during the year to October 31 2020, after profits of £124,329 in 2018-19. Turnover for the latest period totalled £14.4m, down from £27.4m previously.
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Scottish Government’s response
We do not want to keep restrictions in place a minute longer than is necessary.”
A spokesman for the Scottish Government said: “We fully understand the challenges facing the hospitality sector as we look to balance measures to suppress the virus and protect lives with keeping businesses open and trading viably.
“The finance secretary has announced up to £12m of funding for businesses in the 14 local authorities remaining in Level 2, including those in the hospitality sector, and we will continue to support businesses that are affected by the extension of restrictions beyond June 28.
“We have engaged extensively with businesses during the pandemic, with more than 820 engagements taking place between March and December 2020, and meet regularly with business representative organisations.
“As the first minister has made clear, decisions taken around easing current restrictions will be based on the data available in Scotland, and we do not want to keep restrictions in place a minute longer than is necessary.”