UK prime minister Boris Johnson has warned hospitality venues could be fined for failing to enforce social distancing rules, in a televised speech to the nation on Wednesday.
Johnson used a live Downing Street press briefing to highlight the government’s plans to tighten coronavirus restrictions from Monday, saying he was “simplifying and strengthening” the rules. Most social gatherings in England will be cut from 30 to six people, and police given greater powers to enforce the limits.
The prime minister revealed premises and venues where people meet will have a new legal duty to take and keep customers’ details, with local authorities encouraged to enforce the law. Meanwhile an army of council “COVID-secure marshalls” will enforce social distancing in city and town centre venues, he added.
“These measures are not another national lockdown. The whole point of them is to avoid a second national lockdown,” said Johnson. He even hinted theatres could be allowed to re-open in a way “much closer to normal” this year, and repeated a previous claim some aspects of life could return to normal by Christmas.
His comments came after the government’s chief medical officer Chris Whitty said infection rates had increased “rapidly” in recent days, and warned Britain risked following Spain and France with a further spike unless further action was taken.
Pub and leisure stocks tumbled on Wednesday amid alarm and uncertainty over how far the gathering rules could hit customer numbers, with some details still to be confirmed.
Pub chiefs warned the measures will erode a fragile recovery in consumer and business confidence, and small events firms said large bookings had already been cancelled.
Investors meanwhile fear even stricter rules that hammer the economy could be on the way. The lockdown imposed in March fuelled the steepest quarterly decline in UK output since records began 65 years ago. GDP plunged by 20.4% in the second quarter.
“The fear is that this is just the top of the iceberg, as the government begins to ramp up tightening measures first in a list of potential actions that could ultimately hit businesses,” said Josh Mahony, a senior market analyst at IG, ahead of Johnson’s speech.
Emma McClarkin, chief executive of the British Beer & Pub Association, said tighter gathering rules had been a “surprise,” and warned new announcements could have a “cooling effect on public confidence.”
McClarkin called for continued business rate relief, VAT and beer duty cuts and sustained furlough support to help pubs survive and save jobs.
Pub chains JD Wetherspoon (JDW.L) and Marstons (MARS.L), cinema giant Cineworld (CINE.L) and airlines EasyJet (EZJ.L) and Tui (TUI.L) were among the biggest fallers on the stock market in London earlier on Wednesday.
Mahony said it showed investors feared further growth in COVID-19 cases “will likely lead to restrictions on travel and social interactions,” including other countries imposing quarantine rules on UK travellers.
The gathering rules appear to be hitting some firms’ trade already. One Derby-based caterer said a client had cancelled an event booking on Wednesday. "We were just getting back on track with events up to 30 guests, so this announcement is a disaster,” said Helen Skripek, director of The Butlers Pantry.
Mike Fishpen, an Oxfordshire chef for private dinner parties, also said three bookings had been scrapped on Wednesday as guests no longer planned to come. “I have even lost a large deposit for Christmas Day. It’s hard to know if I will have any income now going into winter.”
But the Treasury caved into pressure to provide more support for firms on Wednesday. Small firms forced to close because of local lockdowns or “targeted restrictions” can apply for a £1,000 grant for every three weeks of forced closure, and large firms can apply for £1,500.
Business groups welcomed the move, but warned it did not go far enough. The Confederation of British Industry (CBI) called for an extension to the furlough scheme, and more deferred VAT payments.