Chancellor of the Exchequer Rishi Sunak showed great appetite for his Eat Out to Help Out scheme when he spent an evening as waiter at a Wagamama chain restaurant to launch this August scheme. He really was serving Britain the world’s most unusual scheme to revive the economy post-lockdown. The challenge will now be how much spending in restaurants continues past the end of the scheme this month-end.
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So far, it’s gone better than expected. More than 64 million meals have been served under the scheme, under which the government pays half the bill per diner up to ten pounds, from Monday to Wednesday. The scheme has been on offer at 85,000 or so restaurants. The scheme still has a Monday to go.
Nervous about a collapse in customers, a rapidly growing number of restaurants is extending the scheme into September. They have reason to worry. Eating out at half price would seem attractive after release from months in lockdown when the government foots half the bill. For many the other half too, by way of furlough payments to many millions.
The furlough scheme is due to end in October. Past that people will be given what is coming to be seen as the strange option to eat out with money they have earned or have, or not to eat out at all. The way it’s always been before the pandemic, the way people have of late become unused to.
New restaurant discounts from September vary. Some are offering a simple continuation of the scheme discounts on their own for a couple of weeks into September. Others are coming up with discounts of their own. This particularly employment-friendly business employs more than two million people in Britain or used to. It needs to recover to bring itself and Britain back to old ways.
In new encouragement, the government is launching a drive next week to encourage the resumption of work from offices. That brings more promise for restaurants and to quick catering around office blocks in the heart of cities. Central London hopes especially to be saved from the ghostly look it now carries.
There’s a reason for hope. Retail sales are bouncing back, in many areas to pre-pandemic levels. Much of that too is funded by government-paid furlough money and a release from long containment in homes. October is likely to cut discounts and reduce money in hand for millions. It’s also when winter approaches, bringing fears of a resurgence of the virus. It will be some time before Rishi Sunak can celebrate.
Perhaps the biggest outcome of the eating out scheme is not so easily measured. Other than the occasional pub, no large outbreaks have been reported as a result of eating out, yet. That has eased fears around the virus. Unless of course, that is itself reason for some fear.
Resurgence
Retail sales and dining is not all that is seeing a resurgence. The virus is, too. On Thursday Britain reported 1,522 cases, about 500 more than a day earlier. The pace of rise is more dramatic across Europe. France is reporting around 6,000 new cases a day now. Figures have risen enough to bring renewed alarm in Spain. Virus cases are rising also in Italy and Germany, with Britain already ahead of those two.
That brings back memories of March when cases raced ahead of Britain across mainland Europe. Britain was hit later and ended up doing worse than all others. Not all of this new rise is due to more testing. The number of red zones in France has shot up from two to 21. The pattern of new cases is everywhere localised in particular areas. That becomes easier to isolate and contain, but there isn’t a long gap between a lot of clusters expanding into a national pandemic.
The reopening of schools across Britain next week and increased movement into offices, and all the movement this will bring among children and parents, and in and around offices, is certain to spread the virus further. The government is holding its breath to see just how much more. The greater uncertainty is whether the virus could win the race against the vaccine come winter. But it is increasingly more clear that every country is now prepared to risk the virus, not another national lockdown.
—London Eye is a weekly column by CNBC-TV18’s Sanjay Suri, which gives a peek at business-as-unusual from London and around.
Read his columns here