Hotel industry reels as COVID three-tier system bites in Devon

“The value of the visitor economy to Devon is £2.5BN and people employed is 63,000 and the estimated loss of revenue due to the pandemic is £1.3BN. The visitor economy is vital to the region, and many businesses will not survive this next phase if further assistance is not forthcoming. “

Eye-watering numbers – Owl has always believed that our local economy is dangerously over-exposed to tourism. It is an economic sector which provides seasonal and low paid employment. Future recovery plans must look to diversification. Not an easy task when tourism is so entrenched.

Colleen Smith www.devonlive.com

The tourism and hospitality industry across Devon is reeling as the new three-tier COVID restrictions have started to hit hard with redundancies, closures and financial losses already amounting to hundreds of million pounds.

The largest hotel group in Devon, TLH Leisure Resort which employed 420 people in Torquay, has already made redundancies and has warned staff there will be more job losses to come.

Hotel and coach tour companies are reeling as the three-tier system of local lockdowns limits millions of people from travelling outside their local areas.

Sally Everton, Visit Devon’s tourism boss, said: “The repercussions this will have across the many tourism and hospitality businesses across the county is immense.

“With travel restrictions now in place for many people across the country, the adverse knock on effect into half term will be catastrophic for many. Cancellations had already started with the Rule of 6, which of course includes children, so many group and extended family group bookings had already gone affecting many self catered accommodation providers.

“I am now hearing of increasing cancellations across the county from all areas, which is a major concern. The lost revenue for October half term is estimated at over £287M which is hugely worrying for us.

“The value of the visitor economy to Devon is £2.5BN and people employed is 63,000 and the estimated loss of revenue due to the pandemic is £1.3BN. The visitor economy is vital to the region, and many businesses will not survive this next phase if further assistance is not forthcoming. “

Carolyn Custerson, Chief Executive Officer of the English Riviera BID Company Ltd, said that in Torbay alone the tourist industry has lost £138 million because of COVID: “All the new COVID restrictions are unfortunately going to have repercussions for our local Tourism and Hospitality businesses with a large part of our market now unable to travel on holiday.

“We have already seen notable Group Coach cancellations which is very worrying.

“We will continue to promote the English Riviera and Devon as a great year-round destination but have no choice but to focus our activity closer to home whilst these latest restrictions are in place.

“The English Riviera has lost £138 million so far from the impact of COVID.”

Torbay relies heavily on the tourist industry and many staff who were on furlough during the first lockdown will now be put on to the new and less generous Job Support Scheme (JSS) which will be introduced on November 1.

JSS will replace furlough from November 1 for six months. The Chancellor announced it will be targeted at businesses required to close entirely due to tighter local or national coronavirus restrictions.

Under these proposals, the government will pay two-thirds of wages for businesses forced to close in the coming months as it seeks to slow the rise in coronavirus cases.

Jason Garside the CEO of TLH Leisure Resort – a huge complex of linked hotels and leisure facilities covering 7.5 acres near the Riviera Conference Centre, said the business had gone from an annual turnover of £14m to a likely £8m this year – and that was boosted by the boom in August and September this year when guests flocked to the Bay.

He said: “We are currently dealing with the loss of all our Welsh business.”

Mr Garside said TLH was in a strong cash position before COVID and because of that the business will survive.

He said: “We will survive this and we want to retain our loyal dedicated workers – 70 of our staff have been with us for more than 10 years. It’s more costly to keep staff than it is to make them redundant.”

But he said that after making a strong start the Government was losing its way: “The new Job Support Scheme does not go far enough to support the hospitality business.

“It’s not going to mitigate fully against job losses. We will use it over the next six months and attempt to retain as much of our workforce as we can.

“Business levels are less than a third of historic levels for the next six months.

“We have already made some redundancies. We employ 420 people and initially we made around 32 full time equivalent posts redundant – less than 10 per cent. Now we are reviewing future redundancies.

“We are going to use JSS and we have informed our workforce that we will retain as many as we can.”

Mr Garside was part of a management buyout of the hotel group in 2018 along with fellow directors Iain Piercy and John Finnegan.

He said: “It’s frustrating that the government have not got to grips with track and trace and we are disappointed with how they are communicating through media announcements followed by late guidance.

“It’s further eroding confidence. We went to great lengths to ensure we were a COVID secure hospitality business.

“We experienced a boom in August and that was very positive for us. But then a week ago the Government announced tiering and further restrictions on parts of the country. “

Mark Wright, director of Majestic Tours and the Torquay Majestic Templestowe Hotel, said: “We have refunded in excess of £2million this year due to cancelled tours.

“It really is a scary time for everyone and it looks like a number of hotels along Belgrave Road have closed.”

Majestic Tours usually brings over 350 coaches of holidaymakers a year to Torquay.

“Hopefully, we will all be able to trade through the winter, all be it on reduced numbers of guests, able to keep all our staff employed – without the safety net of furlough.

“In relation to coaches from Wales, we haven’t had an arrival since South Wales went into lockdown.

“We cancelled all coaches departing from Wales from the 25th September immediately they had lockdown announced and refunded all clients.”

In the meantime the Templestowe is closed for a two week £100,000 refurbishment to the ballroom.

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