BATH BID BACKS CALL FOR SPECIAL SUPPORT MEASURES FOR RETAIL, HOSPITALITY AND LEISURE BUSINESSES

• The Bath Business Improvement District (Bath BID) represents 197 hospitality businesses and 293 retailers in the centre of Bath
• Data provided by VISA suggests that expenditure lost to these sectors during the spring period of the pandemic was at least £142 million when compared to 2019
• Bath’s businesses face higher than average rates and rent bills
• Bath is moving into tier two on 2nd December

The Bath Business Improvement District (Bath BID) is backing Croydon Business Improvement District’s Bounce Back Better campaign, which is calling on government to do more to support retail, hospitality and leisure businesses and ensure towns and cities across England have the ability to recover from tier restrictions and lockdowns.

Bath has been a visitor destination for two centuries. Its employment and business activity is uniquely based around the visitor economy, as city centre businesses have grown around Bath’s historic visitor attractions. The city’s annual footfall is estimated to be 6 million, and in 2018, Bath was the 11th most visited city in the UK by international staying visitors, welcoming a total of 348,000 through the year.

Because of the city’s economic reliance on the hospitality trade, Bath’s businesses and the people employed in them will be dependent on the proposed special support outlined in the Bounce Back Better Manifesto, particularly sector specific grant support, help with employee costs, the business rates holiday extension and the extension of the VAT reduction scheme.

From Wednesday 2nd December, England will fall back into a tiered system, placing irrevocable pressure on hospitality businesses but also those in retail and leisure sectors. UKHospitality has already warned that the new tier three system will result in 94% of hospitality businesses becoming unviable by March 2021. In tier two, it is 75%, and even at tier one, 25% of hospitality businesses will become unviable.

The Bath BID agrees that sector-specific measures require sector-specific support, and this manifesto outlines a range of packages which will provide a vital lifeline for hospitality, retail and leisure businesses alike.

The manifesto follows intense and thorough talks with businesses, Business Improvement Districts, Local Authorities, destinations and industry bodies to provide options of support to help the UK economy ‘Bounce Back Better’.

On 18th March 2020, Rishi Sunak, Chancellor of the Exchequer said: “We will support jobs. We will support incomes. We will support businesses. We will help you protect loved ones. We will do whatever it takes.”

Allison Herbert, Chief Executive of the Bath BID, is keen to see the manifesto adopted: “We are pleased to offer our support to this manifesto challenge which was launched by Croydon BID. Sector-specific support will be essential to help Bath find a way through the challenges of this pandemic. We urge the Chancellor to stand by his promise to do whatever it takes and make sure that the city does not see large numbers of closure and job losses.”

Bill Addy, Chair of the BID Foundation and CEO of Liverpool BID Company, said: “The government has the chance to act now and lessen lasting damage to economic growth and jobs. The UK’s economy recovery rests on local businesses continuing to trade and generate employment opportunities. This manifesto asks the government to extend existing measures and introduce a one-off funding injection that together will stem the bleeding out businesses are facing."

Ellie Leiper, Owner of The Grapes Bath and Director of the Bath BID, said: “The government appears woefully out of touch with the costs associated with running a business. Costs far outweigh the £3,000 grant offered under the current scheme and more is needed to support businesses like ours to ensure the continued vibrancy of the hospitality sector in Bath.

“We are grateful for the furlough support we have received but grant funding will not even cover the costs we have for National Insurance and pension contributions, let alone rent, supplier costs and utilities. Without deeper and more targeted government support, I am concerned that businesses will end up closing their doors forever, hospitality will not be there to help the economy get back on its feet and we will lose the employment which the government is working so hard to protect.”

Four Essential Asks in the ‘Bounce Back Better’ Manifesto

1. A One-Off Grant for Retail, Leisure and Hospitality Businesses

Local Authorities lack the administrative and payments infrastructure required to facilitate monthly financial support model proposed by government for eligible businesses in tier two and tier three – many businesses are receiving funds too late, or worse not at all.

We ask government to provide a one-off ‘Bounce Back’ grant of up to £15,000 for retail, hospitality and leisure businesses in tier two and tier three across England and Wales with a rateable value of up to and including £150,000. This would support 137,000 businesses vital funds delivered in a manner Local Authorities are equipped to distribute at a total maximum cost of £2.05 billion.

2. A Pause on National Insurance Employer Contributions for Furloughed Employees

For the furlough scheme investment to date of £47 million to be fully effective, business support must reflect short- and long-term challenges.

While employees receive 80% of their salary through the extension of the furlough scheme, businesses are still paying out for National Insurance, placing greater strain on survival. At an average wage of £9.50 per hour, working 7.5 hours per day, five days a week, the National Insurance cost to a business in hospitality with ten staff is £491.60 per week. Every month, on top of all the other costs, businesses will be paying out £1,966.50 – nearly two-thirds of the upper limit of funding provided by the government currently.

We ask government to remove the burden of National Insurance from employers whose staff are on furlough, saving the average business £2,000 per month until 31st March 2021.

3. An Extension of 100% Business Rates Holiday for 2021/22

The ‘payment holiday’ for retail, hospitality and leisure businesses with a rateable value less than £51,000 earlier this year was an extraordinary and critical measure saving each business up to £25,000, a total tax cut worth over £1 billion.

We ask government to extend the 100% business rates holiday into 2021/2022 for businesses in the retail, hospitality and leisure sector. Every pound saved is a pound to help businesses stay trading and retain staff.

4. An Extension of VAT Reduction Scheme

The cut in VAT from 20% to 5% is a major boost for the hospitality sector enabling businesses to pass on a £4.1 billion saving onto consumers. With a vaccine becoming a reality in the coming months, our bed and breakfasts, hotels and restaurants could be a vital catalyst to local economic recovery.

Research by CGA for UKHospitality, the British Beer and Pub Association and the British Institute of Inn keeping found support on VAT and business rates are top of hospitality's essential business support needs. Four in ten affected businesses have stated that the government needs to extend its VAT cut to remain viable.

We ask government to extend the VAT reduction from 1st April 2021 up to and including 31st March 2022.