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UKH welcomes Scots £14m Hotel Recovery Programme but more aid needed

UKHospitality has welcomed the Scottish Government’s announcement of its Hotel Recovery Programme and the confirmation this provides of the importance of, especially larger, hotels to the country’s economy.

UKHospitality has, however, expressed concern that the programme is not sufficiently resourced to deliver the scale of support required by the hotel sector.

Finance Secretary Kate Forbes today announced a hotel recovery programme worth £14m to help support the Scottish tourism industry.

The scheme, which will be managed by the enterprise agencies and VisitScotland, aims to protect larger hotels which have been especially badly hit by the impact of the pandemic. The fund is due to be open for expressions of interest by the end of August.

UKHospitality Executive Director for Scotland, Willie Macleod said, “The £14m programme is a positive sign of intent, but it is going to be a drop in the ocean for the sector. The reality is that any programme of recovery intended to keep hotels in Scotland open and staff in jobs, will need to be much bigger and much more wide-ranging. It must be hoped that this is an initial step in supporting these businesses and that further resources will be made available in the likely event that the programme is over-subscribed.

“These are businesses that have been devastated by the pandemic. Almost all of Scotland’s tourism and hospitality businesses ground to a complete halt over the Spring. Not all businesses are yet open and those that have opened are operating below capacity and have concerns about medium-term profitability. The future of many hotels and so many jobs around the country is still in the balance.'

Macleod continued, “Support will need to be much more extensive to ensure it reaches all businesses who need it. UKH estimates that there are around 950 larger hotels in Scotland, with a rateable value over £51,000, which did not qualify for grants that were available to smaller businesses. Many were unable to access government-backed loans or the Hardship and Pivotal grants provided by Scottish Government. On average, hotels had to meet £60,000 each month during lockdown to cover fixed costs.

“As the Government has identified, these businesses employ lots of people and support a long supply chain. A budget of £14m may mean that only 50 businesses, 5% of larger hotels, will be supported if each qualifies for the maximum sum. This is not enough to avert the crisis facing the sector.”