Britain’s retail sector has warned of “severe” consequences from new Tier 4 restrictions, meaning non-essential shops in affected areas have had to close in the week before Christmas.
The British Retail Consortium said thousands more jobs could be at risk – in an industry already devastated by months of pandemic disruption.
It criticised the government’s “stop-start approach” as “deeply unhelpful” and joined other groups in calling for an extension of a business rates holiday to help struggling firms.
BRC chief executive Helen Dickinson said the Tier 4 announcement, which affects London and much of the South East, was “hugely regrettable” after retailers had invested hundreds of millions making their premises COVID-secure.
“The consequences of this decision will be severe,” she said.
“This decision comes only two weeks after the end of the last national lockdown and right in the middle of peak trading which so many are depending on to power their recovery.
“Faced with this news – and the prospect of losing £2bn per week in sales for the third time this year – many businesses will be in serious difficulty and many thousands of jobs could be at risk.
“The government will need to offer additional financial support to help these businesses get back on an even keel – an extension to business rates relief in 2021 is the best place to start.”
Arcadia – Sir Philip Green’s Topshop to Dorothy Perkins group – and Debenhams have been the most recent high-profile victims, with the collapses of those two alone putting 25,000 roles at risk.
Latest official figures showed a fall in retail sales in November as England’s lockdown took its toll and the new restrictions will mean the chance of a pre-Christmas high street sales recovery for the likes of toy shops and fashion stores is cut short.
Adam Marshall, director general of the British Chambers of Commerce, said: “Christmas was already cancelled for many businesses, but even more will now suffer as a result of this last-minute decision.
“While government must act on public health concerns, it must also address the economic consequences of its actions.
“Will there be more help for firms being forced to shut their doors – and for those who have paid for stock they now can’t sell?
“With huge numbers of firms already on the edge, it would be unconscionable for further restrictions or closures to be announced without a more comprehensive package of support.”
Martin McTague, vice chair of the Federation of Small Businesses, said: “From shops to hairdressers, this would normally the one of the busiest times of the year.
“Many will have bought extra stock and increased staff hours, now their takings are to disappear literally overnight.”
Matthew Fell, chief UK policy director at the CBI, said: “It’s right the government takes steps to protect public health – but new restrictions in the South East will be a kick in the teeth for struggling businesses.”
Rachael Robathan, leader of Westminster City Council, said: “On every level this is devastating… for those businesses now staring into the abyss after having had a last gasp at pre-Christmas sales snatched from them.”
The tier announcement came days after the extension of the UK’s furlough scheme – subsidising wages for temporarily laid-off workers during the pandemic at the cost of tens of billions of pounds – until the end of April.
Britain’s economy slumped to its worst recession on record earlier this year and is expected to shrink again in the current fourth quarter after the second lockdown – with the latest measures looking certain to add to the gloomier outlook.