It has been a month since all catering establishments were forced to close shop. Their closure came at the wrong time. You may say it is always the wrong time to pull down the shutter.  

Well, not quite.

In the normal catering business cycle, January and February are the quietest months. Incoming tourism is always at its lowest and regular patrons tend to press pause on their usual dinning routine after the busy Christmas festivities. The 2019 Christmas and New Year’s festivities have been very slow for many catering establishments. Joseph Muscat’s resignation in the wake of the political crisis had a negative impact on businesses, mostly the catering industry.

So the restaurateurs and hoteliers greeted the New Year with apprehension. Their cash flow was already low and they had the full knowledge that January and February would be difficult to manage. Still, no hotel or restaurant made any of their employees redundant. They were expecting business to pick up in March and be back to their busy routine by Easter.

The closure of catering establishments could therefore not have come at a worse time. Most of these establishments are family-run. They employ a few employees and do not have millions of euros stacked to weather this situation. In short, they do not have the financial muscle to sustain themselves, let alone their employees. That is why they are relying on the government’s assistance in these difficult times.

When I heard the news of the closure of all catering establishments, I met a number of restaurateurs. I visited them in their restaurants. They led me to their kitchens and showed me all the food preparation. They showed me their fresh supplies, fish, shellfish, meats, poultry, vegetables, dairies and other products.

“Do you want to take some?”, was their common question. “As we will be throwing away most of it”, they explained.

You might be asking yourselves why they do not freeze their products. The answer is simple. There are products which cannot be frozen. The shelf life of most restaurant products is short.  The kitchen preparation too cannot be frozen. Yes, there are some products that can be frozen and they have been.

Still, thousands of euros have been thrown away.

While caterers are closed they still have to keep their electricity running. Freezers will continue to run as do refrigerators. White wine and beers, for instance, must be kept chilled. Establishments cannot therefore switch off their power, as these particular drinks cannot be re-chilled. So there is this running cost which has to be borne by business owners.

The biggest headache for caterers at the moment is the wage bill. I can assure you that no businessman in this industry wants to lose employees. In normal circumstances, the industry had a shortage of qualified personnel.  For small establishments, employees are like family members and it is heart-breaking for any establishment owner to lose any of his/her employees.

But the situation is desperate. As I already said, most caterers cannot survive. They have a problem feeding their own family and regretfully have made some of their employees redundant.

As one director in the hospitality industry told me, the financial packet announced by the government recently was a slap in the face. It was a mere PR exercise, floating the idea that €1.8 billion are being made available when in fact less than 10 per cent of that will be in direct aid.

Rarely has the General Workers’ Union criticised a Labour government’s initiative. It did on this occasion.

The package introduced later will still not save the industry. Most employees earn substantially more than the minimum wage offered by the government and they need more than the minimum wage to pay their rents, bills and their bread and butter. Furthermore, the operators in the industry are not in a position to top up salaries as their cash flow does not permit it. So the latest measures will barely change the dire situation the industry is in.

The government should roll up its sleeves, dig deeper in its surplus pockets and act now, because this month may be too late for many small businesses.

The prime minister and his finance minister are expected to save jobs. To do so they must immediately top up their latest package. They must assist businessmen by reducing the water and electricity bills by 50 per cent. The Malta Tourism Authority is also expected to waive the annual catering contribution for this year. National Insurance contributions should be credited and not expect employers to foot the bill. Furthermore, these businesses deserve a six-month moratorium on their current loans.

In the past years catering businesses, from pastizzi shops to snack bars to fine dining restaurants and hotels mushroomed around the islands of Malta and Gozo. They have contributed immensely to the economy by employing thousands of workers of different skills. Their contribution was a determining factor in the country’s surplus.

It is now the time to pay back some of the surplus they created. It is time for the government to save the catering businesses.

Hermann Schiavone is a Nationalist Party MP.