York businesses ‘at risk of failure’ need Covid recovery support

CALLS are being made for the Government to save York businesses by creating a Covid Hospitality Recovery Fund.

City of York Council leader Keith Aspden has written to ask the Business Minister, Alok Sharma, to provide additional financial support to the city’s hardest-hit sectors.

He said many York businesses and hundreds of jobs are at risk if the Government failed to step up as the city faces new Tier 3 restrictions.

Cllr Aspden wants the Government to create the new fund, using the more than £2bn business rate relief repaid by major shopping chains, and to extend the Local Restrictions and Support Grants to firms in the supply chains of businesses forced to close.

He said urgent action was needed to ensure small firms survive the difficult period ahead compounded by Brexit.

“The effect of these policy decisions will be key to truly levelling up the economies of the North. Government must provide comprehensive support to minimise the damage to business and save the livelihoods of people across the city and the region.”

In his letter to Mr Sharma, Secretary of State for Business, Energy and Industrial Strategy, Cllr Aspden said public health remained the city’s top priority – but the impact of a lack of financial support for local businesses should be recognised.

“The business rates relief and grants, given to impacted sectors at the outset of the Covid-19 pandemic, was hugely important in saving many of York’s hospitality businesses and hundreds of jobs.

“However, months of either closure or extremely tight restrictions across a wide range of sectors due to the impact of job losses have seen balance sheets reduced almost to breaking point.

“As York now faces new Tier 3 restrictions, many businesses are in urgent need of comprehensive financial support.”

He said research suggested the Covid-19 lockdowns had left 610 York businesses at ‘immediate risk of failing’ with additional 624 businesses at a ‘real risk of failure’ – with around 6,243 jobs at under threat.

He said the Government was pushing responsibility onto stretched councils by providing them a ‘discretionary’ fund to support businesses.

“It does not even cover what is needed to provide immediate support payments to local businesses. While there are grants in place for businesses forced to close, this is simply not enough to cover their losses and there is no extra support for business which supply them like security, catering and cleaning.

“Government must ensure that the Job Support Scheme as well as the Local Restrictions and Support Grants (LSRG) are available not only to small businesses forced to close or limit their activities, but also to those who are directly connected to these firms via supply chains.

“If we are to ensure that small firms survive the difficult winter ahead, then it is vital that action is taken now to prevent a collapse of local businesses that are the backbone of our economy.

“The effect of these policy decisions will be key in truly levelling up the economies of the North.”

York Press | News