This Jan 9, 2022 photo shows people carrying takeaway dinner boxes in Hong Kong’s Central area, as gyms, bars and evening restaurant dining are closed following the announcement of strict new anti-pandemic controls after a surge in COVID-19 cases in the city. (BERTHA WANG / AFP)
A lawmaker from the catering sector welcomed the launch of the second Employment Support Scheme and proposed a law on rent moratorium, saying the two measures would greatly help restaurants when the ban on evening dine-in services is lifted as expected on April 21.
“The launch of the second ESS will strongly enhance the effect of the proposed legislation because restaurant owners will get the financial subsidy from May to July,” said Tommy Cheung Yu-yan, a Legislative Council member from the catering functional constituency.
Lawmaker Tommy Cheung Yu-yan said the catering sector has obtained a financial subsidy of about HK$5 billion from the fifth and the sixth round of the Anti-epidemic Fund, but it cannot offset the loss of HK$30 billion during January and March as restaurant owners still have to pay exorbitant rents, payroll, and other operating expenses
“With the resumption of evening dine-in business after April 21, the catering industry can recoup some of the business losses, and the ESS launch makes the proposed legislation to have more significance and impact,” he said.
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The Hong Kong government announced earlier that it will fork out between HK$26 billion ($3.32 billion) to HK$31 billion to launch the second Employment Support Scheme, which will benefit an estimated 1.1 million to 1.3 million employees. Employees whose salaries are less than HK$30,000 per month will be reimbursed HK$8,000 a month for three months. The government will disburse the salary subsidy to employers in May, June and July.
The lawmaker said the catering sector has obtained a financial subsidy of about HK$5 billion from the fifth and the sixth round of the Anti-epidemic Fund, but it cannot offset the loss of HK$30 billion during January and March as restaurant owners still have to pay exorbitant rents, payroll, and other operating expenses.
Even in the current challenging business environment, some landlords still are not reducing rents. At least 30 to 40 percent of the labor workforce also cannot work because they are infected or in quarantine.
Cheung said he appreciates the launch of the Temporary Unemployment Relief Scheme under the sixth round of the Anti-epidemic Fund, which will provide a one-time subsidy of HK$10,000 to unemployed people to alleviate their financial stress during the fifth wave of the COVID-19 pandemic.
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The Legislative Council in February approved HK$27 billion for the sixth round of the AEF, comprising 48 programs estimated to benefit 67,000 businesses, operators of 40,000 transport tools, and 750,000 individuals.
“I expect the second ESS will endow a financial subsidy of HK$6 billion to the catering sector. With the three-month ESS, the job market of the catering industry will be stabilized, and the industry can prepare for the resumption of evening dine-in business after April 21,” Cheung said.
Cheung called on landlords to cut rents again, saying landlords and restaurant owners should use this opportunity to find their way out of the woods together.
The Hong Kong government proposed legislation on a rental enforcement moratorium for tenants of specific sectors, which forbids landlords from terminating leases and from taking legal action against those who fail to pay their rent on time. The proposed legislation, which would be in effect for three months, would target specific industries, including the 17 scheduled premises under the Anti-epidemic Fund.
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Last week, the government announced that if COVID-19 infections do not rebound, social distancing rules would be relaxed in three phases starting on April 21. The first phase will allow restaurants to operate until 10 pm, four hours later than the current 6 pm mandatory closing time. The first phase allow will allow four diners per table, up from the current two.