Businesses warn of jobs bloodbath in 'Halloween horror' second lockdown

31 October 2020, 20:40 | Updated: 1 November 2020, 09:03

Businesses have called for extra support
Businesses have called for extra support. Picture: PA

By Ewan Somerville

Business leaders have hit out at Boris Johnson’s “Halloween horror” of closures as he ordered England into a second national lockdown.

Many industry leaders welcomed the Prime Minister extending the furlough scheme to cover the month-long shutdown from Thursday until 2 December, but demanded extra support and clarity and warned the NHS Test and Trace system needs to be far better.

The Prime Minister said that without action, deaths would reach “several thousand a day”, with a “peak of mortality” worse than the country saw during the lockdown in April.

Pubs, bars, restaurants, non-essential shops and gyms will all close for four weeks - but schools and universities will stay open.

The Treasury announced that, alongside the extension of the furlough scheme, businesses which are forced to close in England can receive grants of up to £3,000 per month, while local authorities will be given £1.1 billion for one-off payments to firms in their areas.

Read more: Boris Johnson orders England into second national lockdown

“Make no mistake, this could be the final straw for thousands of pubs and brewers. It will also create major disruption to our supply chain partners whose businesses are now also at severe risk.

“The level of financial support will need to be same, if not greater, than that provided for the first lockdown earlier this year. This means grants for all pubs sufficient to cover ongoing fixed costs, and compensation grants for Britain’s brewers who will also be permanently devastated by the lockdown."

Derek Cribb, chief executive of IPSE (the Association of Independent Professionals and the Self-Employed), said: “Government must urgently fix the unfair disparity between employee and self-employed support.

“Right now, the self-employed can claim just 40% of their earnings compared to 80% for employees through the extended furlough scheme. This cannot stand as we enter a second national lockdown.”

London mayor Sadiq Khan said he was “furious” that the Government has “dithered and delayed yet again”.

He tweeted: “Their indecision will have unimaginable consequences – both lives and livelihoods will be lost as a result.”

He added: “It is absolutely imperative that the Government does not repeat its dithering when it comes to the additional economic support that will now clearly be needed.”

TUC general secretary Frances O’Grady said: “The Government should have acted decisively much sooner and now families face a grim winter.

“The extension of the furlough scheme is long overdue and necessary, but ministers must do more to protect jobs and prevent poverty.

“Furlough pay must never fall below the national minimum wage. We need a boost to Universal Credit and Government should not abandon the self-employed. And we will not control the virus unless the Government fixes the test and trace system and the scandal of workers asked to self-isolate without decent sick pay.”

Warning of “financial armageddon” on “the most horrific of Halloweens”, Michael Kill, chief executive of the Night Time Industries Association, said: “It’s frightening to think that given the gravity of the situation, we are still being given limited communication, consultation or time to respond, or plan around these decisions.

“The entire night time economy consisting of thousands of businesses and hundreds of thousands of workers are suffering.

“Their plight is being made even worse by the huge void in financial support for the sector.”

British Chambers of Commerce (BCC) director general Adam Marshall said the new lockdown would be a "devastating blow".

“Business and market confidence have been hit hard by the unclear, stop-start approach taken by governments across the UK over the past eight months, with little end in sight," he warned. "Many firms are in a much weaker position now than at the start of the pandemic, making it far more challenging to survive extended closures or demand restrictions."

Chancellor Rishi Sunak said: “Over the past eight months of this crisis we have helped millions of people to continue to provide for their families. But now – along with many other countries around the world – we face a tough winter ahead.

“I have always said that we will do whatever it takes as the situation evolves. Now, as restrictions get tougher, we are taking steps to provide further financial support to protect jobs and businesses. These changes will provide a vital safety net for people across the UK.”