Rishi Sunak's Job Support Scheme labelled 'purely PR' which won't prevent 'swathes of redundancies'

Hospitality groups have warned the measures do not go far enough to protect jobs

Sunday, 27th September 2020, 7:30 am
Hospitality businesses have warned the new Job Support Scheme will not prevent mass redundancies
Hospitality businesses have warned the new Job Support Scheme will not prevent mass redundancies

The night-time economy could be decimated by redundancies and closures following the announcement of a new jobs protection scheme from the UK Government’s chancellor Rishi Sunak.

Michael Grieve, the chair of the Night-Time Industries Association Scotland (NTIAS), warned the plans offer “literally no support” to businesses which are being forced to remain closed such as nightclubs and live music venues.

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He said the night-time economy was being “thrown to the wolves” and the measures announced by the UK Government would cause “enormous damage” to the economy and cause “swathes of redundancies”.

Mr Grieve said: “This new Job Support Scheme offers literally no support to businesses in the sector which are still forced to remain closed due to COVID-19 restrictions. The UK government has chosen only to support ‘viable’ businesses, completely ignoring those who have been unable to trade since March.

"This includes the entirety of the late night economy with nightclubs and live music venues in particular completely thrown to the wolves!

“Even for places able to trade, the 10pm curfew makes operating barely viable. Costly and crippling restrictions have been placed on the sector, particularly in Scotland which has levied a completely bizarre ban on background music which no other country in the world has imposed.”

Mr Sunak, announcing the Job Support Scheme which will replace the furlough scheme at the start of November, admitted it may not be enough to prevent rising unemployment and businesses going to the wall, saying “lives can no longer be put on hold”.

Once in place, the scheme will see the state contribute towards the wages of employees who are working fewer hours than normal.

Employers will continue to pay staff wages for the hours they work. But for the hours not worked, the UK Government and the employer will each pay one third of their equivalent salary.

However, Mr Grieve said the scheme is effectively asking employers to pay time and a half for employees working fewer hours and businesses earning less through reduced trade.

He said: “Allowing much loved entertainment, cultural and social institutions to disappear, in an industry which employed over 1.3 million and contributed £66 billion per year to the UK economy pre Covid, will do enormous damage to the economy and more importantly to the social fabric of our nation.

“There is no question, we will see swathes of redundancies across the industry following this purely PR focused announcement as businesses are forced to make a decision on the future of their businesses and their workforce. The simple message to the Government is more direct support is needed and needed now.”

The fears were echoed by the Scottish Licensed Trade Association, whose managing director, Colin Wilkinson, warned of 12,500 job losses in the pub and bar sector if more support was not forthcoming.

He said: “Without having full details, our initial view is that the Chancellor’s introduction of a Jobs Support Scheme and the extension of other initiatives to help businesses are not as far-reaching as we needed – we are very disappointed.

"The future for businesses and employees will still be under threat as many business owners may still have no choice but to close. A recent survey highlighted that nearly 40 per cent of hospitality businesses were considering closure or business exit while a recent SLTA survey highlighted that, within the pub and bar sector, 12,500 jobs could go.

"More must be done for a sector operating under serious restrictive measures.”

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