The chancellor yesterday faced growing calls from the business community for urgent financial support amid fears that the plan B pandemic restrictions announced this week could slow the economic recovery.
The warning to Rishi Sunak was outlined in a letter co-signed by Shevaun Haviland, director-general of the British Chambers of Commerce, and Baroness McGregor-Smith, its president, warning of the impact on the hospitality industry, in particular.
The letter spells out concerns that the impact of the restrictions had not been offset by fresh support, leaving businesses with little means of mitigating the loss of trade.
The business group said that it was very concerned about the knock-on effects from the plan B policies, with numerous members in the hospitality sector warning that parties and events were being cancelled, even though such gatherings remain permitted.
While Boris Johnson has insisted that office Christmas parties should go ahead, in Scotland Nicola Sturgeon, the first minister, urged people to cancel them as she warned that Britain faced a tsunami of Omicron infections.
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The Treasury so far has ruled out providing fresh financial support to hospitality and retail businesses that face losing sales over the critical festive period. Officials have indicated that could change under further restrictions.
In a separate letter to the government, the Liberal Democrats called for urgent support for hospitality firms affected by plan B after the “unprecedented rates of booking cancellations”. They said that businesses in city centres that relied on office workers also would be hit hard by the new measures.
Emma McClarkin, 43, chief executive of the British Beer & Pub Association, said her members estimated that plan B restrictions would wipe as much as 30 per cent from takings.
The British Chambers of Commerce urged the chancellor to consider a series of policy measures that could be brought in to alleviate the pressure on the worst-affected businesses, including reverting to an emergency VAT rate for hospitality and tourism of 5 per cent and reinstating 100 per cent business rates relief.
Haviland, 49, said that the BCC had written to Sunak because urgent action was needed to maintain the strength of the economic recovery: “It is simply not good enough for the government to say at this juncture that ‘enough support has been provided’. These restrictions will have the greatest impact on some of the firms, like hospitality, events and retail, who have been hit hardest throughout this pandemic.”
