The Mayor of London has called on Westminster City Council to reconsider “short-sighted” plans to charge hospitality businesses thousands of pounds in fees to continue trading outside.
The Council is set to charge businesses £7 per square metre of outside space, per day, once the existing ‘al fresco’ scheme comes to an end on October 31.
One small coffee shop and deli, ScandiKitchen, say they will be hit with a bill of £2,000 a month for a space that can only house six people according to the firm’s twitter account.
The operator of much-loved restaurants Quo Vadis and Barrafina told City A.M. the fees would equate to a bill of between £50- to £100,000 a year.
The Mayor told City A.M.: “At a time when businesses in the hospitality industry face huge challenges and great uncertainty about their future, excessive charges like these are short-sighted and counter-productive.
“I urge Westminster Council to reconsider and make outdoor services affordable for hospitality businesses so that we can keep the centre of London vibrant and open throughout this challenging time.”
The fees – which were revealed in a document seen by City A.M. entitled “Supporting Westminster’s hospitality sector during the winter” – will be a further blow to hospitality businesses already battered by new Tier 2 restrictions across the capital.
Peter Dore-Smith, owner of coffee shop Kaffeine, described the move as a “real kick in the guts.”
Hospitality firms have already been battered by curfew schemes and restrictions on different households mixing inside, making outdoor seating all the more vital for those looking to survive the winter.
“This is an across the board charge, it does not matter what street your are in, what hours you operate, what you serve, what price point you have, nothing. It is ridiculous and every person I speak to cannot believe it,” Dore-Smith continued.
Westminster Council, which covers Soho and much of the surrounding area, allowed ‘al fresco’ seating over the summer, with some streets closed to allow small restaurants to flow out into the streets.
Bars and restaurants in the pedestrianised areas were asked to contribute to security costs.
Those schemes will cease to operate at the end of October, and the Council – who issued the new guidance on October 20 – acknowledge in the document that “there may be… a period of time between the ending of the temporary al fresco summer dining schemes at the end of October and installation of new ‘winter appropriate’ ones,” leaving businesses in limbo.
James Hart, whose firm The Hart Group is behind Barrafina and Quo Vadis on Dean Street in Soho, told City A.M. that the Council was “missing the point.”
“They should be supporting businesses, not trying to profiteer themselves and trying to market their streets as if it’s a rateable premise,” he continued, noting that Westminster hospitality businesses pay amongst the highest rents in the world.
Restaurant, bar, and coffee shop owners will have to re-apply for pavement licences, which will come to an end on October 31, in a process that could take up to 14 days.
The Council claims to have spent £2m over the summer on facilitating the al fresco schemes. It will also allow outdoor heaters and umbrellas where licences are granted.
On the fees, the guidance states: “Businesses that benefit will be expected to pay any rental costs for barriers as well as a fee for the use the street space given over to approved temporary winter al fresco dining schemes.
“This will equate to a flat fee of £35 per day for each 5m space, which will be billed monthly. We recognise that any cost is a burden on businesses and the council is proactively seeking to identify support funds that can be accessed.”
The guidance also indicates that winter schemes will ‘ordinarily’ be limited to one side of a street, leading to a potential street-by-street lottery of which businesses are able to operate on pavements and potentially into the street.
A Westminster City Council spokesperson said: “The council has already spent well over £2m on supporting al fresco dining across the city and we will continue to invest in projects which support hospitality in the West End.
“We are asking businesses to make a contribution to cover part of the costs of running these schemes. We think this is the right way to help our world-famous hospitality sector while also being fair to our residents who have to pick up the bill for the remaining costs of these schemes through their council tax.”
The Council refuted the charge they were profiting from the scheme.