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Business / Lounge owner sounds closure warning as isles pubs face uncertain future

The Lounge pub in Lerwick.

THE OWNER of a Lerwick pub has warned that he could be forced to close up if the bar does not reopen this year.

Philip Manson, who has owned The Lounge for over 20 years, estimated that if the pub remained closed this year due to the coronavirus pandemic his loss of income could be between £400,000 and £600,000.

He admitted if that was the case then he would be tempted to “pull the plug and convert it into flats”.

With pubs likely to be among the last businesses to reopen from the coronavirus pandemic, there is lack of clarity as to when pints might start being pulled again in Shetland.

Not only is there the loss of income, but stock which has already been paid for may have to be poured down the drain as it reaches its sell by date.

The Lounge, located up Mounthooly Street, should have been in fine fettle after welcoming people attending the Shetland Folk Festival for sessions of both the musical and drinking varieties.

Manson said the festival is “one of our biggest events of the year” and usually draws in income of £35,000 during the week.

The Lounge has a total of 16 staff on its books across full-time and part-time positions, and some are furloughed on the government’s job retention scheme, which pays 80 per cent of wages.

Manson said it did not make financial sense to furlough its pool of casual staff, who only work now and again and have other jobs, but they are still in the system.

He said there is a feeling that bars might be able to reopen at Christmas time, but there is no official guidance in place. This has left pub owners, who are understanding of the decision to close on public health grounds, in the dark.

“The breweries have taken back the kegs and are giving us a credit for when we do open,” Manson said. “But my other stock, that will go out of date, and that won’t go back because that’s been paid for.

“The insurance won’t pay out anything. I’ve tried, but they just point blank refuse to pay anything. Their exact words to me was they couldn’t pay out – if they paid out everybody they would go bankrupt.”

As it stands, £8,000 worth of stock in the Lounge may have to be poured down the drain if the pub remains closed for a prolonged period of time.

Pubs are being given rates relief from the UK government though, while Manson has also accessed the £25,000 grant available for the retail, hospitality and leisure sectors.

“But you still have the electric charges going out, the water charges going out, and the insurance is still going,” he said.

“With nothing coming in, it’ll not last a year. The money we have in the bank will not keep us going the year, as simple as that.”

Manson estimates that in addition to the estimated £35,000 income lost from the folk festival week, the business has lost around £8,000 a week in potential income since the pub closed in March.

He is also not sure over the idea of pubs reopening with social distancing measures in place.

“If you put this social distancing on you, or this two metres between you, you’d get about eight folk downstairs in the Lounge,” Manson said, adding that pubs are social venues which thrive on people being in groups.

The Marlex (Douglas Arms).

At the other side of the centre of Lerwick Anna Hepburn of the Marlex also said there was a feeling that the pub might have to stay closed until Christmas.

“There’s nothing else you can do really,” she conceded.

Hepburn said the Commercial Road pub has put its full-timers and staff that do not have another job on the government’s job retention scheme.

She also said losing stock is likely to be a problem. “I doubt by the time we open a lot of it will be out of date,” Hepburn said.

“The way things are, I don’t think it’ll be before Christmas,” she added.

“We’ve got a lot of tourists, certainly helps during the week to have them.

“We’ve always been fairly busy. I’ve had it for over 45 years. We get a good mix of old and young, which is good.”

Hepburn, though, said she would rather that everybody was “alive and able to come back than open too soon”.

At Da Kiln Bar in Scalloway, owner Vera Setrice described the situation as “very daunting”.

“You don’t know when you’re going to be open again or not,” she said.

“And then you wonder if you’re going to have staff when do you open, because they’re furloughed at the moment and I wonder how long they’re going to furlough them.”

The Kiln Bar in Scalloway.

The bar, which is currently on the market due to personal reasons, has a cafe area but Setrice feels there is little point in doing takeaways if there are few workers in and around the village.

“Even if they said we could open for takeaways in the cafe, that’s all very well if there’s workers out in the community, but there’s not much point in us opening to do takeaways if there’s nobody out in the community working,” she said.

She also believes re-opening with social distancing measures in place could prove difficult.

“They’re speaking about social distancing in the pub…but it would be no use if groups of folk were coming in,” Setrice said.

“It’s very daunting for everybody, and the place is just like a ghost town,” she added.

“But as long as people are safe, we have a lot to be thankful for. We really do.”