If there are any changes to the 21 June ‘unlocking’ date as a
result of this government’s failure, announced this Monday – it
must be paired with details of economic measures to support
affected businesses and industries, Labour has made clear today.
While Labour believes the roadmap should be guided by the
science, throughout the crisis government incompetence has meant
they have been too slow to act, and too often details of economic
support have regularly trailed behind public health
announcements, severely damaging business confidence, causing
anxiety, and even leading to workers being let go unnecessarily.
Labour is warning of a ‘perfect summer storm’ brewing for high
street businesses still affected by restrictions if the 21 June
is delayed but this change is not matched by economic measures,
with several pinch points for businesses coming down the track:
- On 23 June, quarterly rent is due.
- On 30 June, the ban on commercial rent evictions ends.
- On 1 July, employers must start contributing 10% to furlough
costs.
- On 1 July, 100% business rates relief tapers off to 67%
business rates relief.
The hospitality industry is likely to be one of the worst
affected industries if the unlocking date slips, with a quarter
of the industry still closed. That includes those legally
required to shut like night clubs and live music venues, as well
as those for whom it is not currently financially viable to open
because of restrictions impacting trade, including wedding
venues, events spaces and very small pubs and bars.
From 1 July, businesses will no longer be legally protected from
evictions by their landlords. It is estimated that around £6
billion of debt accrued during the crisis is owed to commercial
landlords - with 90% of this total in the retail and hospitality
sectors.
It is estimated that two-thirds of retailers in the UK are at
risk of legal action on at least one of their stores, and around
40 per cent of hospitality businesses have not reached an
agreement on rent arrears.
In the hospitality sector, 12,000 premises have already been lost
during the crisis including 1 in 10 hotels and restaurants and 1
in 5 casual dining businesses.
, Labour’s Shadow Business Secretary, said:
"Businesses have operated under historic uncertainty during this
crisis, worsened by details of economic support playing catch up
with public health announcements.
“Now once again, businesses are in the dark, with a perfect storm
of financial pinch points brewing and no reassurance from
government that economic measures will remain in step with
possible changes to the roadmap.
"It is right we remain guided by the science to tackle this
virus, but businesses should absolutely not be paying the price
for the Government's poor handling of our borders and the new
variant.
“We’ve got to back businesses on our high streets and safeguard
the recovery of local economies. Businesses should not have to
worry for even one day that economic support will be pulled away
whilst restrictions remain in place."
Ends
Notes to Editors
- The British Retail Consortium has said two-thirds of
retailers in the UK are at risk of legal action on at least one
of their stores.
- UKHospitality said 40% of hospitality businesses have not
reached an agreement on rent arrears.
- The Market Recovery Monitor from CGA and AlixPartners shows
that around 12,000 hospitality premises closed in Britain between
January 2020 and March 2021.
- According to a survey of members by the Night Times
Industries Association:
- 9 in 10 venues feared that a delay to reopening would
threaten their survival
- 95% of businesses have already made financial commitments and
logistical preparations to reopen on June 21.
