UK businesses call for more government support during new Covid lockdown

The business lobby group the CBI has urged the government to come up with a comprehensive support package to help firms survive the latest Covid-19 lockdown.

As England and Scotland enter another lockdown, business groups said the government must step in with further support measures.

Tony Danker, the CBI’s director general, said the government should not wait until the March budget to announce more support for businesses, and that he was expecting the Treasury and business department to do so in the coming days.



He told BBC radio 4’s Today programme: “Make no mistake, the economic impact of these new restrictions is very significant.

“Demand in the economy falls again, high streets and physical businesses lose footfall, recovery is on hold in terms of a big hit to trade and business investment. We’ve seen lockdowns before, we know the impact they have and so more comprehensive restrictions do require a more comprehensive economic response.”

He said it was vital to ensure firms had the cashflow to make it through the winter, and pointed to VAT deferrals, other tax relief and more generous grants as possible measures. The hospitality industry had already lost out on its “golden quarter” over Christmas and for gym operators the current quarter was crucial, he said.

With pubs closed across the UK and takeaway sales of alcohol now banned in England, the pub industry said the current level of grants was not enough to cover ongoing costs such as rent.

The Campaign for Pubs called for closure grants to be increased to at least £1,000 a week; a statutory rent code to stop unreasonable rents; a business rates holiday in 2021-22, VAT of 5% on all pub sales, not just at places that sell food; and business rates relief for small brewers and other suppliers.

Greg Mulholland, the director of the Campaign for Pubs, said: “Without urgent, adequate support, many pubs – including pubs that have survived for centuries and two world wars – will be lost.”

The Federation of Small Businesses called for a second round of cash grants, help for the more recently self-employed and extended repayment and limits for bounce back loans, among other measures.

Danker said the government must review and plug any gaps from existing support in supply chains, and that firms must have the “assurance that support will be there for as long as Covid-19 restrictions are in place” so that they can plan ahead. The government’s job retention scheme is due to expire on 30 April, and unemployment is expected to rise sharply after that.

“With vaccines here, we are close to the end, but we do need to finish the job,” Danker said. “This was always about protecting viability of firms, this was always about building a bridge to the recovery, we are almost on the other side and we need to put the final pieces in place.”

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