British businesses are calling on the government to extend emergency support for Covid-19 as Boris Johnson prepares to delay ending the lockdown restrictions by up to a month.
The PM is expected to announce a four-week delay in the final easing of lockdown restrictions in England, from June 21, due to the rapid increase in cases of the Delta variant first detected in India.
Kate Nicholls, UKHospitality managing director, said this morning that a one-month delay would be devastating for the sector, which has been particularly affected by the pandemic.
She told the BBC this morning that ministers must offer more support, including extending a moratorium on evictions and debt collection from commercial tenants which is to be lifted on June 30.
If legal restrictions on social contact are not lifted, sports, pubs and cinemas will still face capacity limits and nightclubs will remain closed.
A report released earlier this month showed that nearly a quarter of licensed premises in Britain remain closed, as current restrictions and space constraints make operation simply unviable.
Many of these businesses are “out of the way” after 16 months of no income, Nicholls warned. And for the rest, June 21 was the day they were able to resume trading profitably, she explains.
A delay of four weeks would cost the hotel industry around £ 3 billion in lost saless, Nicholls said. It is therefore crucial that the government provide assistance in several key areas.
One is the rent arrears. Hotel companies currently owe £ 2.5 billion in unpaid rents, accumulated since the first Covid-19 lockdowns. Nicholls says it is vital that the moratorium on applications for commercial rent arrears, which expires on July 1, be extended.
These protections prevent landlords from evicting commercial tenants or using statutory demands or liquidation petitions to collect rent arrears.Nicholls says hotel companies also need more breathing room on corporate rates, because a £ 100million bill is expected to hit the industry in July when the current temporary exemption expires.
Such help will help hotel businesses keep operating, get more people back to work and mend their “broken balance sheets” after sixteen months of trading below profitability, she adds.
The government is also facing calls to delay the end of the leave scheme, which currently pays 80% of salaries to sidelined staff.
From July 1, the government’s share will drop to 70%, with employers contributing to 10%, as part of a withdrawal schedule that will see the end of holidays at the end of September.
But if some hotel businesses cannot open and other businesses are still operating within Covid-19 limits, they will struggle to keep up with this new cost.
Claire Walker, co-executive director of the British Chambers of Commerce, a dit (via The Times):
“We would call on the government to provide new cash grants, at least equivalent to the levels provided in the first lockdown, and to delay cutting government payments into the leave scheme, scheduled for early July.”
The decision to extend the restrictions beyond June 21 will come tonight. But a delay seems inevitable, with ministers being told that a four-week delay in easing all Covid restrictions would likely prevent thousands of hospitalizations.
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