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Businesses hit by Tier 4 restrictions need bigger cash boost, says Labour

Lauretta Roberts
22 December 2020

Businesses affected by the sudden imposition of Tier 4 coronavirus restrictions, such as retailers, hairdressers and beauty salons, need more financial help in the form of a "high street fightback fund", Labour has said.

Shadow business secretary Ed Miliband said nearly 175,000 operations in London and southern and eastern England had been instructed to close by the announcement of new lockdown measures at the weekend. Miliband accused Business Secretary Alok Sharma of being “asleep at the wheel”.

The ex-Labour leader said a “hospitality and high street fightback fund” was needed as the “vast majority” of businesses were only able to access an emergency cash grant “worth around half or a third of the support on offer during the national lockdown in March”.

Labour said this category included 99% of hairdressers and beauty salons and 92% of gyms. Miliband said £2bn returned to the Treasury by supermarkets in business rates relief should be used to help affected firms.

He said: “Businesses are facing a Christmas nightmare on the high street, forced to close at the last minute by Tier 4 restrictions.

“Many shops, leisure and beauty businesses just getting back on their feet have had the rug pulled from under them, joining struggling restaurants and pubs already shut.

“Businesses are doing the right thing and closing to keep people safe, but ministers are not doing the right thing by them.

“We need these businesses on the other side of the crisis but the support is hopelessly inadequate, and the Business Secretary seems to be asleep at the wheel.

“The Government can’t keep leaving businesses in the lurch like this. Ministers must urgently boost support for closed businesses through a hospitality and high street fund to save businesses and jobs now.”

A spokeswoman for the Department for Business, Energy and Industrial Strategy said: “We understand the pressure businesses are under and this Government has stood by them and their staff throughout the pandemic.

“Businesses can access our unprecedented support package worth £280bn, including the extended furlough scheme which is protecting nearly 10m jobs, grants for businesses required to close of up to £3,000 a month, business rates holidays, various loan schemes and VAT deferral.”

Earlier today the British Beauty Council urged beauty businesses to get in touch to help them calculate the cost of the third lockdown for the sector in order that it can lobby the Government for sector-specific support.

The Tier 4 restrictions, which force the closure of non-essential retail, close contact personal care services, indoor gyms and hospitality, were introduced across London, much of the South East and East of England with just a few hours' notice on Saturday. They are to be formally reviewed on 30 December but there is no expectation they will be lifted in these areas with a very real chance that Tier 4 will be extended in the coming days.

Retail sources in London say they are preparing for a six- to eight-week shut down with a view to opening, hopefully, during February. The new restrictions mean physical retailers will have lost crucial pre-Christmas sales and the post-Christmas sale period has been wiped out leaving them with huge amounts of unsold stock to clear once re-opening is allowed.

Prime Minister Boris Johnson has said he is optimistic the country will be in a more positive place by Easter 2021 when the most vulnerable people across the country are due to have been vaccinated. So far 500,000 people have received their first dose of the Pfizer BioNTech vaccine. NHS leaders have, however, expressed concern that the roll-out of the vaccine is not happening quickly enough, according to a report in The Guardian.

On a more positive note the so-called "Oxford vaccine" is widely expected to be approved for use this month and would be far easier to roll out as it can be store at normal fridge temperatures.

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