Eat Out to Help Out extension: Who are the real winners of the scheme?

When the government was footing the 50 per cent off bill, it was all well and good, but Clare Finney asks: does lowering the cost of your offering really pay off?

Jose Pizarro, proprietor of several restaurants, chose to extend the initiative this month by paying for it himself (Jose Pizarro)

The gurgle of laughter, the clink of glasses. The warm scent of spices and garlic mingling with that of pizza, sizzling seafood, ramen and a thousand and one other cuisines and ingredients. After months of tumbleweed-strewn silence, for a few brief weeks in August the streets of Britain’s towns and cities flickered happily into life again as the chancellor Rishi Sunak’s grimly named but gratefully received Eat Out To Help Out (EOTHO) scheme (50 per cent off your bill in all restaurants and cafes Mondays to Wednesdays, courtesy of the government – with a cap of £10 per person) lured even the most nervous of diners and coffee drinkers out of their homes and into restaurants and cafes. 

“People were smiling. They were happy and comfortable,” recalls Jose Pizarro, proprietor of several restaurants in London and Surrey. So when August ended, and with it the governments subsidies, he decided to extend it at his own expense: “Boris paid half of your bill in August, Jose will pay HALF of it in September!” ran the announcement on his Instagram feed. 

Pizarro is not alone. In London, scores of well-known restaurants have followed suit, including such beloved joints as Homeslice, Kricket, Farzi Cafe, Tapas Brindisa, Elliot’s and Casa do Frango. Many chains are in on it too: from Bill’s to Burger King, Toby Carvery to Franco Manca – and you’ll find variations on the deals in independent restaurants in cities and towns across the country.  

The reasons for doing so, even without the government footing the cost of it, are clear, says Pizarro. “We were busy on days we’d normally be quiet.” Before August, Monday to Wednesdays would be “pretty quiet – even before the pandemic”. When EOTHO arrived, these days were fully booked. 

The scheme was so successful (more successful than even the aptly nicknamed Dishy Rishy could have anticipated) because, once tempted out by the promise of a bargain, people rediscovered eating out again.  

“It was a message from the government to the public that it is OK to go to restaurants again – and it worked,” observes Will Beckett, founder and CEO of Hawksmoor, the steak restaurant group. Restaurants and cafes reclaimed their regulars and – better still – picked up new customers. “It certainly has allowed us to meet new customers we would not have met before,” says Kobir Ahmed of Prana restaurant in Cambridge. “And people were happy,” Pizarro reiterates. “The spending per head was a bit more. If I need to give away £10, I am glad to be able to do it.”

And yet, and yet. While the logic of these discounts make sense in the short term, the lessons of 2008 tell a different story, says Beckett – who has decided not to extend Hawksmoor’s EOTHO offer into September. 

“In 2008 mid-market dining decided to get through the financial crisis off the back of vouchers – and then for the next five years found it impossible to wean their customers off them. They got used to paying less for the same thing,” he says. But if, as a restaurant, you have faith in your price structure “then you should stand by that. At Hawksmoor, our prices are the right price. We buy good produce. We pay our staff decently.” 

The reason they were able to offer steak and chips for £10 in August – a banging bargain that saw them receive more than 5,000 bookings in the six hours after they announced it – was “because the government subsidised it. Not because our pricing wasn’t right.”

The issue of continuing to discount at your own expense, Beckett continues, is that it sends out the wrong message. “It says something about how you feel about your normal pricing.” Some restaurants are cheap, and that is their calling card. “I don’t denigrate people who want to eat in those restaurants but my point to restauranteurs is, know which one you are.”  

Gemma Simmonite of Gastrono-Me in Bury St Edmunds agrees. Adopting a discount long term “ultimately devalues the product you’ve so carefully crafted” she argues. “A successful product costs what it does for good reason. EOTHO was not a discount scheme for restaurants. We were being refunded by the government.” As such, for her all-day restaurant it was “never a question of extending; we hadn’t discounted in the first place. Restaurants playing the voucher lottery permanently are going to end up in a race to the bottom.”

This is not, of course, to detract from the success of the government’s scheme. The message that it’s safe to go out again has been received and that’s great, says Beckett. “But the rent moratorium, furlough, VAT cuts are all coming to an end in October. Soon we will have to stand on our own two feet.” 

Although he can see why his industry peers might feel nervous breaking free from the bargains, for his own part he would rather “see how we get on now rather than artificially inflate our numbers and work out later.” 

“It was an invigorating vitamin shot in the arm for the hospitality industry and was an equal opportunity for all restaurants and cafes,” Simmonite says. Yet if independents feel the pressure to follow the chain’s leads in offering deals they can’t afford, the playing field will quickly cease to be level. “Hospitality is already a fine balancing act between labour and ever-rising food costs,” she continues. “The profit margins are already slim.”  

Besides, isn’t there more at stake at this point on the road to economic recovery than whether restaurant diners (by definition fairly fortunate) get a tenner off their thali? 

“The restaurant sector has had a lot of support. You can quibble about how effective that’s been, but it hasn’t been matched across other causes,” says Alex Claridge, head chef and founder, of The Wilderness in Birmingham – who cites the issue of homelessness and those charities which try to address it as one such ticking time bomb. “Come 30 September all the protections around evictions will be removed,” he says, and the Birmingham-based homeless charity with whom he has worked over the years, Sifa Fireside, expects “a rush of individuals and families seeking shelter and support in the ensuing weeks”.  

His response to the discussions around EOTHO and extensions was to turn the idea on its head. “From Tuesday to Thursday, for every cover we donate £10 to Sifa, and two and half per cent of our service charge. It’s kind of a satire on the scheme,” Claridge says. “When the local rag is more interested in telling you how much you can of get off Nando’s than telling stories about the imminent surge in homelessness, that’s problematic. With our EOTHO, we wanted to ask what help is required – and who really needs it?”  

Of course, many hospitality businesses do plenty for charity, irrespective of this framework – yet Claridge isn’t the first to ask the question. At Prana, Ahmed is continuing to offer a discount – £5 off every meal – but is matching that with a £5 charity donation to those in need. “For a small independent shop, the scheme has contributed to supporting us keeping our staff,” he says – though he suspects it has benefitted big chains more than it has small independents. 

“I just don’t think we can afford to turn a blind eye to these issues. We have been supported by our community and we have a duty to do the same,” says Claridge, who during lockdown managed to crowdfund £30,000 from locals and regulars to support his staff.  

The idea of community is a pertinent one. Sure, there will be plenty of mercenaries looking to monopolise the market with discounted meals this month – but hospitality is, broadly, a generous-spirited industry. Pizarro’s self-funded extension of EOTHO isn’t just about ensuring the survival of his restaurants and staff, it’s about supporting the communities in which he is based. 

In Bermondsey – the London village in which his best-known restaurants are located – he has teamed up with another Bermondsey based chef, Angela Hartnett, to create an area-wide initiative called Shop Eat Drink Bermondsey, which will see a collection of restaurants, bars, shops and services offer discounts on Mondays, Tuesdays and Wednesdays. “This area is a strong community, with residents who like to support local businesses,” Pizarro says warmly. As August drew to a close, he sat down with Hartnett and asked: “What can we do to extend this?” 

They’ve encouraged all manner of businesses to offer discounts – “whatever they can afford” – in an effort to keep that community vibe going and bring in people from outside the area. Of course, this doesn’t work in areas that are dependent on office workers, or for fine dining restaurants like The Wilderness. “When you’re spending on average £150 a head, a tenner off is hardly an incentive,” says Claridge. The wonderful – and sometimes challenging – thing about restaurants is that, with the exception of chains, they are unique. There is no one-size-fits-all answer. In an unprecedented climate, with an uncertain future, these chefs and restaurateurs are for the most part looking to do their best by their staff, their suppliers and –  by direction action or by extension – their communities.