U.K. Businesses Implore Johnson to Ease Rules on June 21

(Bloomberg) -- U.K. industry groups warned that businesses may collapse if Prime Minister Boris Johnson fails to push ahead with a planned easing of coronavirus rules on June 21 despite fears of a fresh wave of infections.

U.K. Hospitality, which represents about 85,000 venues, said jobs will be lost if there’s a delay to plans to end social distancing rules while survey data from the Night Time Industries Association suggests the demise of nine in 10 nightlife businesses after more than a year of enforced closure.

“It’s devastating for the industry,” NTIA Chief Executive Michael Kill said in an interview. “They feel like they’ve been forgotten. They’re at the very sharp end of a long-running roadmap which they’ve watched unfold, to almost feel like they’ve been duped out of their opportunity at the last minute.”

Johnson is caught in a dilemma of whether to prioritize the economy and go ahead with a highly-anticipated easing later this month that would remove all social distancing restrictions and allow large events to happen, or continue to unwind the U.K.’s third lockdown at a time when scientists are increasingly worried about another surge of coronavirus cases.

Adding pressure on Johnson was the decision in Scotland by First Minister Nicola Sturgeon to delay a planned June 7 easing of rules across a swathe of the region including Edinburgh because of an increase in the number of cases of the variant first detected in India.

Prevalence of this Delta mutation is what could prevent England’s plans for unlocking. It has spread across the U.K. and has raised concern of whether a second summer will be lost to the pandemic. The U.K. is also hosting the Group of Seven and climate summits this year.

Johnson’s spokesman refused to be drawn on the government’s thinking, saying only that it needed more time to assess the data. Asked if the government would copy Scotland’s approach of having different restrictions in different places, Jamie Davies said the unlocking was a “national endeavor.” That signals the government won’t try to revive a system of regional tiers that failed to contain the pandemic last fall.

Cliff-Edge

On May 17, indoor hospitality and entertainment sites, such as cinemas, theaters and museums re-opened -- yet with legal restrictions on capacity. Those limits mean it’s been unprofitable for some businesses to return.

“A delay would push many businesses closer to the cliff-edge of failure, meaning more job losses,” said Kate Nicholls, chief executive of U.K. Hospitality.

Businesses such as nightclubs are in an even more precarious position, because they’ve been shuttered throughout the crisis, unlike hospitality, which was able to reopen last summer. That makes the final stage of the government’s plan for reopening even more crucial for them.

“It would be devastating to snuff this glimmer of hope out,” said Craig Beaumont, head of external affairs at the Federation of Small Businesses. “The June cohort of businesses are those that have been closed throughout the crisis. They have no cash reserves and are excited to finally join other businesses.”

Triple Whammy

Britain’s biggest business lobby group, the Confederation of British Industry, said in a statement that all companies are looking to the government for “clear guidance on Covid-status certification and social distancing once the economy fully unlocks.”

While the government has pledged to give an update on the roadmap a week before the planned reopening, Kill at the NTIA said that doesn’t give businesses enough time to test their operations. He said 95% of businesses had already committed funds to the reopening, including stocking up, preparing venues and getting workers back.

Kill described the damage unleashed on the night-time economy as a “triple whammy.”

“You’ve got the workforce that are concerned about whether they’ve got a stable job to return to; you’ve got landlords who are not convinced that our sector is something they want to rent or lease their properties to; and we’ve had challenges around investment,” he said. “That tide needs to change.”

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