Rishi Sunak’s Eat Out to Help Out: Scrutiny at the Covid Inquiry

Chancellor Rishi Sunak’s Eat Out to Help Out (EOHO) scheme, introduced in August 2020, faces fresh scrutiny as Sunak makes his first appearance at the Covid inquiry. The scheme, aimed at providing a boost for businesses in the hospitality sector, has come under fire amid claims that it may have contributed to a surge in Covid-19 cases.

Launching the Scheme

Mr. Sunak’s scheme incentivized consumers to dine out at venues across the UK by offering 50% off on food and non-alcoholic drinks, with a maximum discount of £10 per person. Launched during the pandemic, it was designed to support struggling businesses in the hospitality sector. However, the policy has since faced criticism for not consulting leading scientists before its implementation.

Venue Participation and Claims

The Parliamentary report published in December 2020 revealed that a staggering 78,116 outlets across 49,353 businesses signed up for the EOHO scheme. The majority of claims were made by small businesses, with 93% of establishments having just one participating outlet. Larger businesses with over 25 outlets accounted for 27% of the total discount claimed.

Impact on Covid-19 Cases

Research has indicated that the EOHO scheme may have contributed to a rise in coronavirus cases. In fact, evidence suggests that areas with higher participation in the scheme saw a sharp increase in new infections, potentially contributing to 69,000 new cases. Leading scientists, including former government chief scientific adviser Sir Patrick Vallance, have argued that the scheme drove a second wave of Covid-19 cases in the UK.

Cost and Financial Implications

The EOHO scheme incurred significant costs, with the Government paying out £840 million to participating establishments. However, the total cost of claims submitted amounted to £849 million. Despite the financial burden, the measure was successful in boosting economic output, particularly in the food and beverage service economy.

Industry Response and Economic Impact

Although the scheme received criticism for its potential contribution to the surge in Covid-19 cases, UK Hospitality chief executive Kate Nicholls praised the EOHO scheme for boosting confidence and footfall. The initiative is credited with contributing to the growth of the food and beverage service economy. However, despite the apparent success, the industry’s output and turnover in August 2020 still remained below pre-pandemic levels.