Coronavirus – Economic Issues

Eat Out to Help Out Scheme

Note4Students

From UPSC perspective, the following things are important :

Prelims level : Eat Out to Help Out Scheme

Mains level : NA

Since the lockdown began in India, different bodies representing the country’s hospitality sector have repeatedly asked the government for financial assistance to help tide over the crisis. UK’s popular Eat Out to Help Out (EOHO) Scheme can be an example of the kind of intervention in India.

Note: The ‘Eat Out to Help Out’ Scheme recently seen in news is related to Hospitality. One may get confused over Poverty and Hunger.

What is the EOHO Scheme?

  • The EOHO Scheme is an economic recovery measure by the UK government to support hospitality businesses as they reopen after the lockdown.
  • The scheme was announced as part of the Plans for Jobs summer economic update.
  • Under the EOHO Scheme, the government would subsidise meals (food and non-alcoholic drinks only) at restaurants by 50 per cent.
  • There is no minimum spending and no limit on the number of times customers can avail the offer, since the whole point of the scheme is to encourage a return to dining in restaurants.

Why was this scheme deemed necessary?

  • 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.
  • Instead of delivering a financial package to operators, it makes eating out more affordable for consumers directly and helps restore demand.
  • Restoring consumer demand is being seen as crucial to the UK’s economic recovery.

Can India benefit from such a scheme?

  • The main problem confronting the restaurant industry, following Unlock 1.0 in June, has been consumer fear, even as the government has remained silent about specific recovery packages aimed at the hospitality industry.
  • The government needs to work on the demand side.
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