Yahoo Finance Coronavirus: Lockdown costs UK retailers £22bn
Three national lockdowns, including the one that’s currently ongoing, have cost retailers an estimated £22bn ($30.5bn) in lost sales, the British Retail Consortium (BRC) has said. It has urged the government to step in in order to avoid administrations, shop closures and job losses.
It noted that 2020 was “the worst year on record” for retail sales growth with in-store non-food declining by 24% year-on-year and footfall down over 40% in 2020.
The BRC said the lockdowns took a major toll on ‘non-food’ stores – mainly ‘non-essential’ retail, which wasn’t allowed to stay open during lockdown.
It added that tight restrictions, particularly “in the crucial run up to Christmas” hampered retailers’ ability to generate much-needed turnover, which would have helped power their recovery in 2021.
The report argued that the retail sector is essential to ensuring future revenue streams for government and local councils and vital for supporting local communities: retailers contributed £17bn in business taxes in 2019, collecting a further £46bn in VAT.
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Ahead of chancellor Rishi Sunak’s announcement of the budget for 2021 on 3 March, the BRC had said action on business rates, rents and grants is crucial to the recovery of not just non-essential retailers and the wider economy, but to prevent “the further loss of thousands of jobs in communities across the country.”
It has called for an extension to business rates relief for the worst-affected businesses to reduce the unsustainable cost burden on retailers.
It believes this will give them “a fighting chance to continue trading, employing staff and serving their communities.”
The BRC also wants an extension to the moratorium on debt enforcement to support thousands of retailers who face accumulating rents even while their stores are unable to trade.
And finally, it said the decision to apply EU state aid limits to lockdown grants should be reversed and all bureaucratic restrictions stopping businesses receiving these vital support funds promised by the Chancellor should be removed.
Helen Dickinson BRC’s CEO, said: “It is essential that the chancellor uses the Spring budget to support those businesses hardest hit by the pandemic.”
“The investment we provide to retailers now, will be repaid many times over through more jobs and greater tax revenues in the future,” she said.
It was reported last week that UK retail footfall plummeted due to coronavirus restrictions as January saw it at its lowest point since May 2020.
Wales is the worst hit nation, seeing a 79.1% year-on-year decline according to data from BRC and ShopperTrak.
UK high streets and shopping centres have been dealt a particularly hard blow as they saw a 73.3% and 78.2% reduction in footfall respectively.
Meanwhile the Bank of England last week cut its growth forecasts for 2021 but predicted a rapid vaccine-driven rebound for the UK economy later in the year.
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