Eat Out to Help Out (EOHO)
The EOHO Scheme is an economic recovery measure by the UK government to support hospitality businesses as they reopen after the COVID-19 lockdown in the country.
Since the lockdown began in India, different bodies representing the country’s hospitality sector have asked the government for financial assistance to help tide over the crisis. Recently, the UK's popular Eat Out to Help Out (EOHO) Scheme has been cited as an example of the kind of intervention the Indian government could make.
● Under the EOHO Scheme, the British government subsidised meals at restaurants by 50 per cent, from Monday to Wednesday every week in the month of August.
● The discount was capped at GBP 10 per head and did not apply to take-away or event catering.
● There was no minimum spend and no limit on the number of times customers could avail the offer, since the whole point of the scheme was to encourage a return to dining in restaurants.
● EOHO was only one of the schemes in the UK designed to help the food services sector. Other financial support measures include a furlough scheme for workers, cutting VAT to 5 per cent from the standard 20 per cent, besides temporary changes to licensing laws and outdoor seating laws, etc.
All over the world, the food services sector is one of the worst affected by the pandemic.
The top two concerns were customers avoiding restaurants for fear of contracting the virus and customers having less disposable income for dining out.
It is the second of these concerns that the EOHO scheme addressed, because, instead of delivering a financial package to operators, it made eating out more affordable for consumers directly and helped restore demand. Restoring consumer demand is being seen as crucial to the UK’s economic recovery.
While the scheme has been welcomed by the hospitality sector, some reservations have been expressed about the efficacy of EOHO.
It has been argued that the scheme may have been introduced too early, since it was not yet clear whether the problem was on the demand side, with people being reluctant to go out and eat, or on the supply side, with restaurants unable to serve enough people, thanks to social distancing.