EOTHO scheme earns £250m for UK government, study finds

Tanwen Dawn-Hiscox

Tanwen Dawn-Hiscox

Deputy Editor 9th September 2020

The Eat Out to Help Out scheme,whereby the  government subsidised half of the cost of meals at participating restaurants up to the value of £10 earned money for the treasury, according to a study by the British Beer & Pub Association, British Institute of Innkeeping and UKHospitality.

While 130,000 claims have so far been received for the scheme, at a cost of £522m for the government, it also enabled 200,000 staff come out of furlough early due to the increase in trade generated by the initiative, saving the government almost £150m in furlough costs.

What's more, VAT generated on additional food and soft drink sales earned the treasury £30m, and sales of alcoholic drinks that accompanied the meals boosted duty and VAT revenues by a further £65m.

Kate Nicholls of UKHospitality, said the scheme "was a shot in the arm for consumer confidence in eating and drinking out of home, right across the country," which "gave our businesses the opportunity to showcase the investment they had made to keep customers safe while also making them feel welcome.

However, she added, the government should not take the success of the scheme as having saved the industry fromt he difficult months to come: “As we approach Winter we need to ensure the right support in place to stimulate a more sustained demand. A significant starting point would be to extend the VAT cut, ensuring the business rates holiday is continued next year and getting more of the UK economy back on its feet, including those businesses that remain closed.”

British Institute of Innkeeping chief executive Steve Alton seconded her comments, saying the scheme "allowed many pubs to start their recovery with a better than expected August trading," but that “further Government support will be required building on this investment to ensure pubs are sustainable businesses in the long term.”

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Tanwen Dawn-Hiscox

Tanwen Dawn-Hiscox

Deputy Editor 9th September 2020

EOTHO scheme earns £250m for UK government, study finds