Crieff threatens cuts
Calls grow to reopen venues as hotels face jobs crisis
Crieff Hydro: bookings down by up to half (pic: Crieff Hydro)
Pressure is growing on the Scottish government for a speedier reopening of leisure and hospitality venues – or provide more support – to avoid a jobs catastrophe.
Crieff Hydro hotel chain is planning more than 241 redundancies unless there is a rapid response from the government to head off the crisis
Its warning follows Pitlochry Festival Theatre’s plan announced on Friday to lay off dozens of staff.
Crieff Hydro is the latest among dozens of hotels across Scotland who say they are at breaking point, with some saying they may not reopen.
Last month seven Scottish hotels as well as Shearings coach tours ceased trading following the failure of a holiday company.
Specialist Leisure Group plunged into administration as the coronavirus prompted all tours, cruises, holidays and hotel breaks to be cancelled.
First Minister Nicola Sturgeon is now being pressed to step up the economic response to the crisis as concern grows that the ongoing lockdown is causing irreparable damage.
Prime Minister Boris Johnson is said to be planning to relax rules on outdoor dining and weddings in England, as well as speeding up government investment plans amid warnings that 3.5 million jobs could be lost in the leisure sector.
Crieff Hydro chief executive Stephen Leckie said a consultation is under way with the workforce across his portfolio of seven hotels.
Mr Leckie said the move followed a significant downturn in trade and loss of revenue, as a result of the lockdown.
The group runs the Crieff Hydro and Murraypark Hotel, also in Crieff, as well as Peebles Hydro and The Park in the Borders and Isles of Glencoe, Ballachullish Hotel and Kinghouse Hotel in West Highlands.
Revenue in the year to end February was up by more than 4% more than £31 million. However, Mr Leckie said he expected bookings to be down 30-50% this year. Despite all the measures taken to reduce costs, lost revenue while the hotels were closed would amount to at least £17m in the current financial year.
He added: “For every month we’ve been closed with zero income, we’ve had to pay £500,000 just to keep our buildings safe and insured. This would have a profound effect on any business. “
The company has used the UK government’s Job Retention Scheme as well as securing an additional £5m in bank loans.
Mr Leckie said: “When we closed our doors at the end of March, it was one of the darkest days in our 150-year history and this is another.
I am personally devastated for every one of our team who could lose their job– Stephen Leckie, Crieff Hydro
“The impact coronavirus has had on our industry and business has been immediate and drastic. As a family-run business built on the strength of our people, discussing potential redundancies is the toughest step we’ve ever had to consider.
“I am personally devastated for every one of our team who could lose their job.”
Mr Leckie had previously echoed calls from Scottish Tory MSP Rachael Hamilton for the Scottish Government to allow self-catering accommodation to open in phase two of its ‘route map’ out of lockdown.
Marc Crothall of the Scottish Tourism Alliance said: “This is a harsh reality of the impact of Covid19.
“Crieff Hydro is a really good, well-run and managed group of hotels who have always invested in their employees and I know it will be hurting the family in having to take this action.
“But without any income coming in for many months and coupled with high levels of monthly fixed costs and with no sign of any long-term grant support being made available to help bridge the gap in the months ahead, businesses like this are now faced with little or no choice but to cut employee costs.
“I suspect we will be hearing similar stories from many more tourism and hospitality businesses in coming days.”
Tourism Secretary Fergus Ewing said it was a “very sad day” for both the business owners and their employees.
He said: “I am aware the owners have worked very hard and continue working hard to find a means of enabling the hotel group to survive the Covid crisis where, like all other tourism businesses they have no revenue, but substantial overheads to meet.”
Rosanna Cunningham SNP MSP, whose constituency covers Crieff Hydro, said: “The hospitality sector has been hit extremely hard by the impact of the coronavirus and whilst this development saddens me, it does not entirely surprise me.”
Airlines protest over quarantine
Three airlines have written to the UK government in protest at its “wholly unjustified and disproportionate” quarantine rules for most international arrivals, according to a letter seen by the Reuters news agency.
From Monday (8 June), most people arriving in Britain will be required to self-isolate for 14 days and to fill in a contact form with details of where they will be staying.
The letter says it is “illogical and irrational” to impose quarantine on people arriving from European Union countries that have lower infection rates than Britain.