London Mayor calls for 12-month business rates holiday extension

By Stuart Stone

- Last updated on GMT

'Final blow': 'If the business rates holiday comes to an end, I worry employers will have no choice but to make more people unemployed,' London Mayor Sadiq Khan explained
'Final blow': 'If the business rates holiday comes to an end, I worry employers will have no choice but to make more people unemployed,' London Mayor Sadiq Khan explained
Mayor of London, Sadiq Khan, has urged the Government to extend its business rates holiday for retail, hospitality and leisure businesses by a further year amid fears of tens of thousands of job losses.

As things stand, rates are due to be reintroduced for new financial year in April 2021, however Khan has warned that such a step could yield tens of thousands of job losses in the capital alone.

“Businesses across London continue to struggle from the impact of Covid-19,” he said. “If the business rates holiday comes to an end, I worry employers will have no choice but to make more people unemployed. 

“Many large retail, leisure and hospitality businesses - accounting for thousands of Londoners’ jobs - are taking important decisions for the next financial year right now, so certainty over the business rates holiday is needed urgently.”

Khan’s comments come after the British Beer and Pub Association (BBPA) implored the Government to extend business rates relief to ensure that pubs facing average bill of £25,000 each don’t fall victim to the ongoing pandemic​. 

“Ending the business rates relief for pubs and handing them a bill of £800m – an average of £25,000 per rate paying pub – could be the last straw for thousands of pubs,” the BBPA’s chief executive Emma McClarkin said. 

“Given that all these pubs made it through the lockdown – over 15 weeks without being able to open their doors – and have remained viable businesses despite social distancing and significantly lower footfall, it would be devastating for them to fall at the final hurdle in the post-lockdown recovery."

The one-year business rates holiday pubs in England and Wales are receiving is worth £768.12m according to figures from real estate adviser Altus Group.

50,000 London jobs at stake 

The New West End Company, which represents 600 businesses in London’s shopping district, repeated Khan’s concerns that reintroducing rates would be the “final blow” for business already fighting for survival.

“The result will be more business closures and potentially 50,000 job losses, severely diminishing London’s appeal to visitors, investors and global talent,” chief executive Jace Tyrrell explained.

“We appreciate the support that the government has given to businesses so far but it is clear that the impact of COVID-19 is going to last much longer than originally anticipated.”

Support over bleak winter months 

Khan’s calls also follow the release of figures from hospitality software provider Fourth which found that the Government-backed Eat Out to Help Out scheme increased the scheduled hours worked by hospitality staff from 12.9m in July to 20.1m in August – an extra 821 years’ worth of extra work​.

Yet despite this, trade body UKHospitality (UKH) has warned that at least 900,000 hospitality sector jobs could be lost nationwide unless the Government provides sector-specific staff support, while the Night-Time Industries Association (NTIA) has cautioned that the collapse of the night-time economy would add almost three quarters of a million job losses to the Office for National Statistics’ (ONS) total for 2020 thus far.

“The hospitality sector has a proven track record in delivering jobs growth,” UKH chief executive Kate Nicholls explained, “but we need Government to be flexible in its approach and to provide the necessary support over the bleak winter months in order for our sector to continue to play a role in the economic recovery.”

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