Scottish Government scheme might not be enough to stop a "tidal wave of job losses"



Business leaders have warned that a new Scottish Government aid scheme might not be enough to “stop a tidal wave of closures and job losses.”

Glasgow Chamber of Commerce chief executive Stuart Patrick said that he welcomed the £40m new additional financial support scheme.

But, he said: “Test and Protect was supposed to allow government to manage the public health crisis whilst keeping the economy going.

“This clearly isn’t working well enough and it is not unreasonable to expect that seven months into the crisis we have a more sophisticated approach.

“Government needs to clearly articulate a plan to manage Covid as it has already been highlighted that constantly switching business on and off is not sustainable and the impacts will damage entire communities.

“Now is the time for all levels of Government to genuinely work together and more meaningfully engage the private sector to identify measures to protect lives and livelihoods.

It was one of several warnings from business leaders reacting to the business and economic impact of a new wave of restrictions announced by First Minister Nicola Sturgeon in a bid to contain the second wave of the Covid-19 outbreak.

The moves include the closure of all licensed premises in five health board areas for a two week period.

Pubs in Greater Glasgow, Lanarkshire, Ayrshire and Arran, Forth Valley, and Lothian will be closed from Friday, up to and including 25 October.

The Scottish Licensed Trade Association has described the First Minister’s measures as “cataclysmic” for the industry with the fallout being hundreds of business closures and thousands of job losses.

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Colin Wilkinson, SLTA managing director, said: “The recent introduction of the 10pm closing time plus the two-household group of six rule is having a devasting effect on the industry – closures are looming and now today’s announcement of further restrictions and temporary lockdowns will only accelerate business failure and job losses.”

A recent survey highlighted that nearly 40% of hospitality businesses were considering closure or business exit.

In September, an SLTA survey of 600 on-trade premises highlighted that within the pub and bar sector, 12,500 jobs could go.

Wilkinson added: “These figures have increased dramatically in only a month. When the industry reopened after lockdown and with the then restrictive measures in place, it was estimated that two-thirds of hospitality businesses could still be viable, but only just, with one-third of businesses unable to open.

“Now that figure has flipped and in our estimation two-thirds of hospitality businesses could be mothballed or go under.

“Over 50% of jobs in the pub and bar sector could also be lost which will have a particularly deep impact on the employment of young people as over 40% of staff employed are under the age of 25.

“Our research already tells us that many in the industry are on the precipice of business failure and these further restriction measures announced today and the much quieter winter season approaching leads us to only one conclusion: the sector is now heading into a scenario of ‘last man standing’.”

The new restrictions include reimposing the two metre rule on customers entering Scotland’s 22,000 shops and reduced trading hours for retailers who operate cafes, coffee shops, food courts and restaurants.

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Scottish RetailConsortium director David Lonsdale said: “Retailers have worked incredibly hard and responsibly to keep customers and staff safe throughout the pandemic, investing tens of millions of pounds on safety measures including plexiglass screens, social distancing and hygiene.

“They will strive to implement these latest changes too, albeit they are being asked to do so once again at absurdly short notice.

“Many will be baffled as to the justification for these new two metre restrictions on stores in the absence of any evidence which shows shops are a source of infection.

“For many of our members with a hospitality offering the further temporary restrictions on trading hours will be hard to bear.

“Those operating cafes, coffee shops, and food-to-go restaurants have adopted every measure asked of them by government, despite the enormous impact on their business models.

“These additional restrictions may make it impractical for some to trade at all for this period, and the government must urgently provide details of the proposed support for these viable businesses.

“The impact of these latest restrictions on consumer confidence and our high streets remains to be seen, particularly in the run up to the critical Christmas trading period.

“More broadly we remain very concerned at the manner and detail of this announcement. Firms have been dealing with months of constantly changing regulations and guidance.

“We urgently need a more strategic and coherent approach which allows firms sufficient time to understand the regulations and their obligations, and to operationalise them. The current approach falls well short of what is required.”

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Food and Drink Federation Scotland’s chief executive officer David Thomson, said: “We are extremely disappointed to see the additional restrictions on Scotland’s fragile hospitality and food service sector, which will of course have a knock-on impact on our food and drink suppliers.

“Food and drink producers supplying hospitality need certainty and good news during these difficult times.

“We urge the Scottish Government to work with the UK Government to ensure hospitality businesses and the food and drink companies that supply them are supported to survive and thrive during these challenging times.

“This will allow the hospitality sector and their suppliers to play their part in Scotland’s economic recovery and the creation of more jobs long-term.”



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