Calls for “cancellation compensation fund” as hospitality industry sees increase in no-show bookings amid covid fears

The Welsh Conservatives have echoed local calls for a ‘cancellation compensation fund’ for businesses amid an increase in no-show bookings.

It comes as many hospitality businesses have seen cancellations of meals and Christmas gatherings over the what is expected to be a busy festive period amid growing concerns around the omicron variant.

Although there are no formal restrictions in place in terms of mixing with other households, fears of contracting the virus over Christmas and uncertainty over the severity of the new variant has led to many people to change their plans over the coming weeks.

Much of the hospitality sector relies on a busy festive period to get it through the year, with hopes that this December would have been a return to a level of normality after the sudden lockdown 12 months ago.

Locally we have been told of a ‘flood’ of cancellation emails and calls coming over the last week, with Sam Regan – Chair of This Is Wrexham (Regional Destination Partnership) adding, “The hospitality industry is yet again facing uncertainty at what is meant to be one of the most lucrative times of the year. Without a significant shift in messaging or the release of funding by the government, the effects will be catastrophic for the industry.”

“Since Mr Johnson made his announcement at the lectern two weeks ago, and subsequent announcements from Mr Drakeford, the level of cancellations for bookings over the remaining festive period has been unprecedented. Many businesses seeing the majority of larger booking being withdrawn.”

“A combination of poor messaging from the Government and scaremongering in the media has given way to consumer uncertainty.”

“As a minimum the industry will need intervention to maintain its workforce. Ideally through the reinstatement of the furlough scheme, or a grant structure that will assist in securing jobs.”

The Welsh Conservatives are calling for a ‘cancellation compensation fund’ to help eateries and pubs, with the party claiming Welsh Government “have enough money in their coffers” and are calling for ‘robust’ action in next week’s budget.

Welsh Conservative Shadow Minister for the Economy, Paul Davies MS, said: “The run-up to Christmas is usually a very busy time for our hospitality sector and this year would’ve been a perfect opportunity for them to recoup some of their losses.

“But with so much concern and uncertainty surrounding omicron, it is clear some people are cancelling their plans, leaving businesses open and still shelling out on costs, but without any trade.

“Pubs, cafes and restaurants have been hit unbelievably hard throughout the course of the pandemic and we cannot afford to see them carry on losing money hand over fist because at the end of the day they will be forced to close with jobs hanging in the balance.

“That is why it is imperative that Labour ministers step in and save the industry by creating a cancellation compensation fund before it is too late.”

Speaking in the Senedd yesterday First Minister Mark Drakeford said he recognised the challenges being faced by hospitality businesses and that the “omicron variant is changing people’s behaviour.”

In terms of additional funding for the indirect damage being caused to the industry, Mr Drakeford said: “I’ve had a series of discussions with UK Government colleagues over the weekend about what the Treasury might be prepared to do to support businesses affected in this way, because, as I know she will understand, this is an impact across the United Kingdom.

“Hospitality and tourism businesses everywhere are seeing this.”

“Of course we will consider what we might be able to do from our own resources. Then, we would definitely hope that the UK Government would be prepared to recognise the impact that the new variant is having more widely on those parts of the economy most directly affected.”