Economy – Page 19 – The NEN – North Edinburgh News

High street footfall increases but big cities struggle as people continue to work from home

Visitor numbers recovered to pre-lockdown levels in many places
But latest tracker data shows no increase in people returning to the office since June
Centre for Cities call for Government to offer further help to impacted retail and hospitality workers if footfall remains low at a time of continued uncertainty

New data from the Centre for Cities’ Street Recovery Tracker, in partnership with Nationwide Building Society, reveals that while footfall in many of the UK’s town and city centres recovered to pre-lockdown levels this summer the share of people returning to the workplace has not increased since late June, despite the UK Government’s campaign to get people back into offices.

Centre for Cities and Nationwide are working together to better understand how large cities and towns continue to be impacted by Covid-19, particularly if the recent rise in cases is sustained.

Overall city centre footfall up by 7% in August

According to mobile phone tracking data, despite the continued reluctance of people to return to their places of work, overall town and city centre footfall increased by seven-percentage points to 63% of pre-lockdown levels since the beginning of August.

In 14 of the UK’s 63 largest cities and towns, city centre footfall in August exceeded pre-lockdown levels. Seaside towns such as Blackpool, Bournemouth and Southend and smaller cities such as Birkenhead and Chatham proved particularly popular with visitors.

Again, overall footfall in larger cities remains well below the national average. In Central London footfall is still at just 31% of pre-lockdown levels, in Manchester it is 49% and in Birmingham it is 52%.

*Where has overall city centre visitor footfall recovered the most?*
Rank	City or town centre	Total city-centre footfall as a percentage of pre-lockdown levels (HIGHEST)	Rank	City or town	Total city-centre footfall as a percentage of pre-lockdown levels (LOWEST)
1	Blackpool	141	1	London	31
2	Bournemouth	133	2	Manchester	49
3	Birkenhead	124	3	Birmingham	52
4	Southend	116	4	Oxford	57
5	Chatham	115	5	Leeds	57
6	Burnley	111	6	Nottingham	59
7	Basildon	110	7	Cardiff	61
8	Doncaster	110	8	Sheffield	63
9	Portsmouth	106	9	Bristol	63
10	Telford	106	10	Leicester	64
*UK city average: Total visitor footfall is now at 63%, compared to pre-lockdown. Week commencing 24 August. Source: Locomizer*

Where is city and town centre footfall back to pre-lockdown levels?
BlackpoolBournemouthBirkenheadSouthendChathamBurnleyBasildon	DoncasterPortsmouthTelfordWarringtonWiganSunderlandHull
*Cities with a footfall score at or above 100% of pre-lockdown levels week commencing 24 August.* *Source: Locomizer*

But levels of people returning to their workplace remains flat

The data shows weekday worker footfall in the centres of the UK’s largest cities and towns remains at just 17% of pre-lockdown levels on average – exactly the same as it was at the end of June.

The share of people returning to their places of work is even lower in many of the largest and most economically prosperous cities with London, Leeds, Birmingham, Manchester and Cardiff all still below the UK city average.

Recovery has been stronger in smaller cities and large towns where weekday worker footfall is on average 27% of pre-lockdown levels. In Mansfield the share of people back at their place of work is now at 42% of what it was in February. However, nowhere has yet reached even half of pre-lockdown levels, so the UK has a long way to go if office life is to ever return to ‘normal’.

*Where are people back in the office?*
Rank	City or town centre	Places with the LARGEST share of people back in their place of work, compared to pre-lockdown (%)	Rank	City or town	Places with the SMALLEST share of people back in their place of work, compared to pre-lockdown (%)
1	Mansfield	42	1	Oxford	9
2	Basildon	38	2	Leeds	13
3	Newport	36	3	London	13
4	Birkenhead	35	4	Birmingham	14
5	Blackburn	35	5	Manchester	14
6	Northampton	34	6	Cardiff	15
7	Stoke	34	7	Reading	16
8	Derby	31	8	Sheffield	16
9	Chatham	31	9	Liverpool	16
10	Wigan	31	10	Portsmouth	16
*UK city average: 17% of people back in their place of work, compared to pre-lockdown. Week commencing 24 August. Source: Locomizer*

The persistently low numbers of people going back to work in city centres, particularly in big cities, reinforces the concerns for the future of shops, cafes, restaurants and bars that depend on office workers for custom.

Centre for Cities’ Chief Executive Andrew Carter said: “Good weather, Eat Out To Help Out and a boost to domestic tourism have helped increase visitor numbers to the UK’s seaside towns, but we should not celebrate too soon. “

We do not know yet whether this will continue into autumn and our biggest cities, which we rely on to power the UK’s economy, are still struggling in the wake of lockdown.

“There is little indication that workers are heeding the Government’s call to return to their offices and city centre restaurants, pubs and shops face an uncertain future while they remain at home. So, unless we see a big increase in people returning to the office, the Chancellor must set out how he will support the people working in retail and hospitality who could soon find themselves out of a job.”

Mandy Beech, Nationwide’s Director of Branches, said: “This latest research tells us Britain’s city and town centres continue to see significantly reduced footfall despite the nation having emerged from lockdown some time ago.

“However, there are positive signs that visitor numbers are picking up in many regional areas. While we can all hope life returns to normal quickly, the reality is that progress will be both uncertain and slow as workers look to return to their offices over the coming months.

“As an organisation rooted in the UK’s cities and towns, we want to do what we can to serve our members as the nation rebalances itself.

“During lockdown we challenged ourselves to keep 90 per cent of our branches open and today that stands at 98 per cent. While our own footfall has fluctuated, our branch employees have been able to support call-centre colleagues to help meet demand.

“As a vital service, we will continue to work in this way as we understand and respond to the needs of our members at this time.”

Regenerating communities

£30 million to support economic recovery

All of Scotland’s 32 local authorities and more than 25 individual community regeneration projects will receive a share of £30 million of new investment for regeneration and town centres.

The funding will be available immediately through the Regeneration Capital Grant Fund (RCGF) and the Town Centre Fund (TCF), both delivered in partnership between Scottish Government and COSLA.

Edinburgh’s share of the Town Centre Fund is £954,000.

The Govanhill Baths refurbishment in Glasgow, Midmills in Inverness, which will support creative industries and cultural social enterprises in the Highlands; and the Mossedge Centre, which will be a multi-purpose facility for use by the surrounding communities in Linwood Renfrewshire are among the community led regeneration projects that will benefit from this funding.

Communities Secretary Aileen Campbell said: “We want to go beyond rebuilding – to refresh and reform and help drive the social and economic renewal necessary to achieve the best future for Scotland.

“This further £30 million capital funding for regeneration and town centres will stimulate local construction across Scotland and support disadvantaged areas in the recovery.

“Communities are best placed to identify specific needs and aspirations and this regeneration funding enables the delivery of a wide range of locally-developed projects to be made into reality.

“Our places must work for our communities, and the Town Centre Funding will build on the success of last year’s fund. With it, local authorities will be able to drive forward projects that help people live better locally and reduce their carbon footprint while driving footfall to local businesses.”

COSLA Environment and Economy Spokesperson Cllr Steven Heddle said: “The additional challenges facing Scotland’s most vulnerable communities due to the coronavirus (COVID-19) pandemic means there has never been a more important time to strengthen the economic, social, and physical wellbeing of our places.

“This additional funding for the Regeneration Capital Grant Fund and Town Centre Fund will support the regeneration aspirations of our communities, and also accelerate the delivery of projects to support the recovery, tackle disadvantage and deprivation and support jobs.”

Linwood Community Development Trust will receive £400,000 from the RCGF this year to bring forward completion of the Mossedge Centre.

Trust Manager Kirsty Flannigan said: “Complemented by the existing 3G pitch, the Mossedge Centre will provide a resource for all within the local community, including a purpose-built home for our community run Roots Shop.

“Now we see the finishing line in sight, and can look forward to the post-pandemic future with confidence, knowing that this project will provide a legacy for present and future generations of the Linwood community.”

This funding will support accelerated delivery of projects this year, and forms part of the £230 million Economic Recovery Stimulus package announced by the Cabinet Secretary for Finance in June.

It includes:

an additional £18 million through the Town Centre Fund (TCF)
an additional £12 million through the existing Regeneration Capital Grant Fund (RCGF)

Briggs hails Eat Out to Help Out initiative

Almost 1.4 million meals were claimed throughout August in Edinburgh, at an average of £6.90 a meal, under the Eat Out to Help Out UK government scheme to get people back to restaurants.

The scheme gave 50% off meals, up to £10 per person through August on Mondays, Tuesdays and Wednesdays.

A total of £9,630,000 was claimed for across 465 registered restaurants in the capital.

Lothian MSP, Miles Briggs, has hailed the success of the Eat Out to Help Out scheme getting customers back into restuarants.

The figures also don’t yet highlight the figures from the last day of the scheme on Monday 31 August, meaning the final total will be higher.

Lothian MSP, Miles Briggs, said: “I am delighted that the Eat Out to Help Out scheme has been such a huge success in Edinburgh and that it has given restaurants a much needed boost after lockdown.

“The restaurant and hospitality sector is central to Edinburgh’s economy and the scheme will have helped many restaurants survive, as well as saving jobs.

“Almost £10 million in claimed discounts show just how big a success this scheme has been.”

Parliamentary constituency code	Parliamentary Constituency	Total number of registered restaurants²	Total number of meals claimed for³ ⁵	Total amount of discount claimed^{4 5} (£)	Average discount per meal (£)
S92	Scotland	8,543	6,333,000	38,607,000	6.10
S14000022	Edinburgh East	604	275,000	1,792,000	6.52
S14000023	Edinburgh North and Leith	533	269,000	1,842,000	6.84
S14000024	Edinburgh South	140	119,000	855,000	7.17
S14000025	Edinburgh South West	527	416,000	2,928,000	7.03
S14000026	Edinburgh West	522	319,000	2,213,000	6.94
		465	1,398,000	9,630,000	6.90

Edinburgh Airport chief: dark days ahead

An open letter to Humza Yousaf

Dear Cabinet Secretary,

The First Minister has said at her daily press briefings and in the Chamber that any life lost to Covid-19 is the loss of someone’s loved one and should rightfully be recognised as such.

Protecting public health has rightfully been the focus of the government’s strategy and we have always been clear that we understand the need to do that and have supported that work which is absolutely paramount at any time, not just during a pandemic. Airports and their process have safety at their core.

However, absolutely paramount at any time is also a strong economy, one that allows government to protect livelihoods, improve the lives of people and further Scotland’s ambitions and credentials at home and abroad.

Last night (02/09/20) I listened to your comments on STV and was dismayed to hear you say that although you were concerned about the impact of Covid-19 and quarantine on the aviation industry, “We can bring the economy back to life, we just can’t bring people back to life.”

Cabinet Secretary, I am sorry that you felt that such a comparison was appropriate. No-one in aviation has advocated trading lives for the economy, and it is unhelpful to be using anyone’s loss to make a political point that side-steps or ignores our open request for engagement in seeking better policies.

In all our engagement with your Government, we have agreed that health measures must be what we build policy around. It has never been in question because business aside, we are human beings first and foremost and we know the true cost of Covid-19.

But this isn’t a binary choice as you have seemed to suggest. It is not a choice between public health or the economy. It is not a choice because we need to do both if Scotland is to rebound and recover.

The First Minister’s Programme for Government this week made promises on jobs, especially the jobs guarantee for young people. That is an ambitious policy planning for Scotland’s future and that is to be commended but, and I’m sorry to be so blunt, you can’t guarantee anyone access to jobs that don’t exist. A strong economy will be key to this and is exactly why the Scottish Government needs to support businesses in sustaining and creating jobs if such promises are to come to fruition.

As an airport, we are a facilitator of many things, from business and tourism to education, research and culture, and all these things are drivers of economic activity. But we’re also one business in Scotland’s economy and there are many more who want to help and who want support from the government to get the recovery started.

Yes, rates relief your Government has put in place has of course been welcome, something we have said in public and in private. And yes, we know that it isn’t available in England or Wales. But what is and isn’t available in other parts of the UK is not our concern – saving Scotland’s aviation and travel industry and rebuilding our economy is.

A quarantine policy that is a travel ban in all but name makes this incredibly difficult, if not impossible. It is ineffective and unworkable as your own figures show and it is having a damning impact on a range of industries. If this is the path the Scottish Government is to continue down then there are some incredibly dark days ahead. I only have to look at my own business to see the real impact it is having. Saying goodbye to 250 colleagues through no fault of their own was one of the toughest experiences in my career. I don’t want others to have to do the same.

If we are to live with Covid-19 for months and years to come then this is simply not a sustainable approach. We need a robust testing regime that protects public health and provides confidence and reassurance to those who need and wish to travel.

We have to manage and mitigate the risk in the best way possible, and that simply has to be a dual approach with balanced attention given to health and prosperity.

Decisions taken now will have an enduring impact on the many quality jobs our industry supports up and down the country, and – if those are too cautious and short-sighted decisions, will significantly undermine the county’s future connectivity and competitiveness.

We are ready, willing and able to help design better systems and processes to protect the health of passengers and staff. We and our colleagues at AGS have spoken with the National Clinical Director, Jason Leitch to explore how best to partner with the Scottish Government on testing. We’re hopeful that our ideas are being listened to and we have a tentative path forward.

We have great respect for the First Minister’s leadership through this health crisis. However, we urge you to make good her words in recognising that the economic emergency is of equal importance to the health crisis.

The aviation and travel industries are not too big to fail. If the Scottish Government position remains as it stands, you are putting tens of thousands of jobs at risk in aviation the next few months alone. The knock-on risks to our tourism sector are even more profound and we would hope you might reflect carefully on our concerns and respond accordingly.

We urge you to reconsider your approach and work with us to find a way to protect public health and rebuild our economy. It is in Scotland’s best interest to do both.

Regards,

Gordon Dewar

Chief Executive, Edinburgh Airport

Scotland in recession after GDP fall

Scotland’s GDP increased by 5.7% in June, according to statistics announced yesterday by the Chief Statistician. The growth in the latest month follows an increase of 2.3% in May, and falls of 19.2% in April and 5.8% in March.

Although output has increased for the last two months, it remains 17.6% below the level in February, prior to the direct impacts of the coronavirus (COVID-19) pandemic.

In June there has been a wider pickup in activity than in May, with output increasing in all the main industry sectors, and in most of the sub-sectors within these.

For Quarter 2 as a whole (April to June), GDP is provisionally estimated to have fallen by 19.7% compared to Quarter 1 (January to March), after a fall of 2.5% in Quarter 1. Across the two quarters of contraction, output is estimated to have fallen by a total of 21.7% compared to 2019 Quarter 4.

This is the third release of new monthly GDP statistics for Scotland, and the first to include a provisional estimate for the whole quarter. These statistics have been produced by the Scottish Government to help track the economic impact of the COVID-19 pandemic, and are badged as experimental statistics (not national statistics) which means they are still in development.

The Monthly GDP Estimate for June.

Commenting on the GDP publication, Scottish Secretary Alister Jack said: “These figures confirm the significant impact of coronavirus on Scotland’s economy.

“The UK Government has put in place unprecedented measures to support people, right across the country, through the pandemic.

“We are supporting almost 900,000 jobs in Scotland through the pioneering furlough and self-employed schemes and have loaned more than £2.3 billion to 65,000 Scottish businesses. This is on top of an extra £6.5 billion of funding for the Scottish Government.

“The UK Government is doing all it can to drive our economic recovery. That includes our £1k job retention bonus, a £2 billion Kickstart scheme to create thousands of high quality jobs for young people, cutting VAT to restart tourism businesses and boosting hospitality businesses with our ‘Eat Out to Help Out’ scheme.

“We know that there are very real challenges ahead of us. The UK Government will continue to do everything possible, working with the Scottish Government, to support people in Scotland through this difficult time.”

Estimated GDP figures for June 2020 have been published by the Scottish Government.

Scotland’s onshore GDP (not including offshore oil and gas extraction) is provisionally estimated to have increased by 5.7% in real terms during June. This follows an increase of 2.3% in May and falls of 19.2% in April and 5.8% in March.

During March and April, output fell in nearly every part of the economy. In May the results were more mixed, with some parts of the economy seen to begin a pickup in activity, but many industries across the services sector experiencing further falls or remaining flat. In June, a much wider pickup in activity can be seen, with output estimated to be increasing in all Scotland’s main industry sectors, and in most of the sub-sectors within these.

The estimates show Scotland’s economic recovery in June was slower than the UK’s as a whole. The UK’s monthly GDP grew by 8.7% in June 2020, following growth of 2.4% in May 2020, whereas Scotland’s GDP grew by 5.7% in June and 2.3% in May.

Growth in Scotland’s retail, wholesale and motor trades sectors contributed 1.5 percentage points to Scotland’s GDP growth in June, compared with roughly 2.8 percentage points for the overall UK.

Despite the increases in May and June, Scotland’s GDP remains 17.6% below the level in February 2020, while the UK’s GDP as a whole has reduced by 17.2% compared with February 2020.

The unprecedented nature of this drop in output can be contrasted to the financial crisis and recession in 2008 and 2009, where Scottish GDP decreased by around 4% over the course of 18 months. Throughout the 2008 Recession, UK GDP shrunk by no more than 2.1% in a single quarter.

These results are provisional and likely to be revised in the coming months.

Helping young people into work

A total of £60 million will be invested in a Youth Guarantee to give all young people access to work, training or education, Economy Secretary Fiona Hyslop has confirmed.

An implementation plan for Scotland’s Youth Guarantee is currently being developed. Funding will come from the additional £100 million Scottish Government investment for employment and skills announced last month.

Speaking to Parliament, Ms Hyslop set out more detail about what the Youth Guarantee will aim to achieve.

She said: “The young people who will make up our future workforce are among those who have been hardest hit by this pandemic. We must support our young people and I want to send a clear message to them today.

“I can announce that the Scottish Government will be committing £60m of the £100m employability fund to support Scotland’s Youth Guarantee, targeted at those most in need of support. This will support young people in a range of ways to help make the transition into work.

“I will bring forward more detail on how we will use this investment with the implementation plan, but I can say now that it will be targeted at those most in need of support, to help them make the transition into work.

“To succeed, we must invest quickly to support a range of interventions to keep young people in work in the next few weeks, to encourage employers to recruit more young people, and to ensure we have enough provision in colleges and elsewhere in the system to prepare young people for future opportunities.

“We must work collaboratively across the private sector, third sector and public sector to ensure no one is left behind, and give them every opportunity in life.

“We want employers to have a clear leadership role. I will encourage employers in all sectors to come forward and support what I see as a crucial intervention to prevent coronavirus (COVID-19) leaving a lasting impact on the employment opportunities of our young people, but also to recognise and promote the valuable and positive role that young people have to play in our economy.”

The Youth Guarantee was one of the main recommendations of the Advisory Group on Economic Recovery.

The implementation plan is currently being developed by Sandy Begbie, who chaired the Developing the Young Workforce Group in Edinburgh, East Lothian and Midlothian and helped design the Edinburgh Guarantee for young people.

A total of £100 million for employment support and training was announced last month to tackle employment challenges. £10 million of this will be used to support a range of measures to recruit and retain apprentices.

Last week the Flexible Workforce Development Fund was doubled to £20 million, to allow employers to upskill and reskill workers for new markets. A further £1.5 million was announced for Business Gateway’s Digital Boost programme to help SMEs adapt to new online digital market challenges – almost trebling the capacity of the initiative for the remainder of this financial year.

Coronavirus support across every region and nation in the UK

New data published by HM Treasury reveals how businesses across every corner of the UK continue to be supported through government-backed coronavirus loan schemes.

new figures show government economic support is reaching every corner of the UK
businesses across the entire UK have received government-backed loans during outbreak – with more than 130,000 firms in devolved nations receiving £4.7 billion
data also shows that nearly 900,000 firms in England have benefitted from over £10 billion in business grants

Figures released by the Treasury show that more than 130,000 firms in Scotland, Northern Ireland and Wales have benefitted from £4.7 billion of coronavirus support through the government’s Bounce Back Loan and Coronavirus Business Interruption Loan Scheme (CBILS).

This includes:

loans and support worth more than £2.3 billion have been given to more than 65,000 firms in Scotland since the outbreak
around 41,000 businesses in Wales have received more than £1.4 billion in finance
and more than 25,000 businesses in Northern Ireland have received over £1 billion

The figures also show that businesses up and down England have also benefitted from more than £10 billion in business grants, with equivalent funding being made available to the nations through the Barnett formula.

more than 102,000 business properties in Yorkshire and the Humber received £1.1 billion in grants since the pandemic
alongside 119,000 grants made in the South West, to the value of £1.3 billion
and 131,000 business properties in the North West receiving over £1.5 billion in support

Loan schemes, grants and business rates holidays have supported businesses across all sectors. But the retail, construction and hospitality sectors, including hotels and restaurants, have benefitted the most.

17% of loans went to the construction sector, and all retail, hospitality, and leisure businesses benefitted from a 100% business rates holiday – demonstrating how government support helped those businesses that were impacted hardest by the pandemic.

Ahead of a visit to Scotland to see the impact of the government support schemes and meet people who have benefitted, Chancellor of the Exchequer, Rishi Sunak, said: “I recently set out the government’s next steps towards economic recovery and securing the UK’s long-term prosperity in our Plan for Jobs.

“As we embark on this next phase, the latest figures demonstrate that we are continuing to support jobs, incomes, and businesses across every corner of the UK.”

As well as loan schemes, grants and businesses rates holiday, around a third of employees in every region benefitted from the furlough scheme, in addition to support through the self-employed income support scheme, as the government moved quickly to support businesses across the whole country to protect jobs.

This is part of a package of over £50 billion in loans, £11 billion in grants, and 9.5 million people furloughed.

The Chancellor set out his Plan for Jobs last month, which will support jobs with the Job Retention Bonus to help businesses keep furloughed workers, and expand Worksearch Support including a Flexible Support Fund and a £2 billion Kickstart scheme to subsidise jobs for young people

The UK government is also creating jobs in the construction and housing sectors through funding to decarbonise public sector buildings, and protecting jobs with VAT cuts for hospitality and tourism, as well as the Eat Out to Help Out discount scheme. These schemes are union-wide, and support key industries across the whole of the UK.

This comes in addition to the government’s recent announcement that the devolved administrations in Scotland, Northern Ireland and Wales will receive a minimum of £3.6 billion in additional funding this year, on top of the £8.9billion confirmed since March to support the coronavirus recovery.

Stephen Pegge, Managing Director of Commercial Finance at UK Finance, said: “Lenders understand that times are tough for businesses up and down the country, but the industry has a clear plan to help them get through this crisis.

“Whether you’re a sole trader in a rural area or a company with hundreds of employees in a major city, the banking and finance industry stands ready to offer the right support to suit your needs and these figures demonstrate that funding is well distributed throughout the UK.

“Businesses should remember that any lending provided under government-backed schemes is a loan not a grant, and so should carefully consider their ability to repay before applying.”

Business Secretary Alok Sharma said: “Our unprecedented package of support has helped firms of all sizes, in all sectors, and in every corner of our United Kingdom.

“Today’s data shows just how big an impact our measures have had, providing breathing space for millions of businesses, safeguarding jobs and protecting people’s incomes.

“As we bounce back from the pandemic, we will continue to prioritise jobs and skills, while placing the environment at the heart of our recovery.”

Government urged to learn lessons from gaps in worker and business support

Darren Jones, Chair of Westminster’s Business, Energy and Industrial Strategy (BEIS) Committee, has written to Secretary of State Alok Sharma outlining a number of key issues for the UK Government to address in its approach to support for business and workers as the country emerges from the Covid-19 lockdown.

The correspondence to the Secretary of State recognises the efforts of many workers and businesses who rose to the challenges brought about during the pandemic.

The letter also highlights a number of issues, including gaps in support for workers, the tapering of support for workers through the Coronavirus Job Retention Scheme (CJRS), and the treatment of workers during the pandemic and health & safety issues.

The letter tackles a number of areas concerning the Government’s support for businesses, recommending the Government review the success of the various loan schemes and the behavior of banks, and also highlighting problems arising from unpaid business rent and the calls for targeted support for sectors that are likely to continue to be hit by restrictions which threaten their future revenue and viability.

Darren Jones, Chair of the Business, Energy and Industrial Strategy (BEIS) Committee said: “The Business Department and the Treasury deserve significant credit for their efforts in addressing the unprecedented challenges faced by business and workers following the impact of Covid-19.

“Given the evolving situation around Covid-19, it’s inevitable that issues would emerge concerning the effectiveness of the Government’s support package and its impact on workers and businesses.

“However, it is also the case that the alarm over gaps in the Government’s support, such as for women, and those affecting freelancers and agency workers, were being raised repeatedly by those affected and yet these warnings continued to go unheeded.

“Rishi Sunak echoed a previous Chancellor in suggesting that the coronavirus has seen us all in it together. However, it’s clear that the reality of the economic lockdown is that its impact has not been shared out evenly and that it is falling very heavily on some parts of our economy.

“For example, we heard from sectors, including retail, the creative industries and manufacturing, who expressed concern over increasing redundancies in the wake of the furlough scheme changes coming in this weekend.

“It’s clear that some sectors of our economy will continue to face very challenging conditions. The shutdown of the aviation and aerospace sector will, for example, have a longer-term impact on these industries compared to others. In some parts of hospitality and in other sectors too, difficult trading conditions and continuing restrictions threaten future revenue and their viability.

“It’s important the Government quickly learns the lessons of recent months so that they can act in future with more policy sophistication and transparency and be able to step up and deliver the most effective support possible to workers and businesses.

“If we face the prospect of a second-wave and the likelihood of increased local lock-downs, it’s essential the Government looks again at its approach to sector support and to the additional measures which will be necessary to secure our economic recovery, help businesses prosper and enable workers to protect their livelihoods”.

The letter to the Secretary of State notes the examples highlighted by Which? of price-gouging, profiteering, and the inability of consumers to obtain refunds which they were legally entitled to when their holidays and flights were cancelled.

The correspondence also notes the comments from Lord Tyrie, former Chairman of the Competition and Markets Authority, stating that the pandemic had revealed that the CMA needed new powers to deal with profiteering.

The Committee calls for the Government to undertake a review of the powers and responsibilities of the CMA, and other consumer regulation enforcers, to address bad business practices and the effective enforcement of consumer law and the action needed to tackle market abuses, such as profiteering, that took place during the pandemic.

The letter to the Secretary of State highlights issues around the impact of late payments and the problems that many small businesses were experiencing throughout the UK’s supply chains because of cash flow problems.

Following evidence from SMEs, the Federation of Small Businesses (FSB), and the Small Business Commissioner (SBC) on these issues, the Committee recommends the SBC be given additional powers to proactively investigate late payments, that the Prompt Payment Code be made compulsory, and that late payers should be excluded from government contracts.

Sue Davies, Head of Consumer Protection at Which?, said: “Our research has highlighted terrible practices during the coronavirus pandemic, including airlines that have refused to refund passengers and sellers that have unjustifiably bumped up prices on essential goods.

“In too many situations consumers have been left with nowhere to turn, which is why regulators need to be given stronger and more targeted powers so they can take effective enforcement to tackle the types of bad practice we’ve seen during the crisis.”

Scottish business confidence remains low

Bank of Scotland’s Business Barometer for July 2020 shows:

Overall confidence of firms in Scotland rose four points in the past month to -37%
Firms’ confidence in their own business prospects was unchanged month-on-month at -33%
One in ten (9%) businesses experienced an increase in demand, up four points on June

Business confidence in Scotland rose four points during July to -37%, according to the latest Business Barometer from Bank of Scotland Commercial Banking.

Companies in Scotland reported the same level in confidence in their business prospects month-on-month at -33%. When taken alongside their views of the economy overall, this gives a headline confidence reading of -37%.

The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide.

The majority of firms continued to see demand negatively affected by coronavirus during July. Almost two thirds (64%) experienced a fall in demand for their products and services, up six points on the month before. However, 9% experienced an increase in demand, up four points on June.

With the Job Retention Scheme beginning to wind down from August, two fifths (41%) of Scottish firms surveyed said they didn’t currently have any furloughed workers.

Of the 55% of businesses reporting disruption to their supply chain during July, 18% expected the situation to improve within three months, while only 2% expected it would take more than 12 months to return to normal levels.

Fraser Sime, regional director for Scotland at Bank of Scotland Commercial Banking, said: “While marginal, the slight increase in confidence we’ve seen this month is a step in the right direction.

“There’s still a long way to go for confidence to fully recover, but the current transition to Phase 3 of lockdown should hopefully continue to boost many firms’ trading prospects.

“Pessimism is waning in many English regions as the hospitality and leisure sectors open their doors once again. With many firms beginning to restart operations here in Scotland this month, August will be telling as to whether the same confidence-inducing effect will take hold here too.”

National overview

At UK level, confidence increased eight points to -22% during July. The North East was the most confident region at -3% followed by the West Midlands (-7%) and the North West (-15%). Wales and Scotland were the least confident with -31% and -37% respectively.

In July, the retail sector increased 11 points to -12%, manufacturing increased 14 points to -21% and services rose 10 points to -26%. However, construction fell eight points to -22% after last month’s strong increase of 30 percentage points.

Paul Gordon, Managing Director for SME and Mid Corporates, Lloyds Bank Commercial Banking, said: “With only one region reporting a fall in sentiment, we are starting to see sentiment lift for the vast majority of regions across the UK.

“The easing of lockdown restrictions, including the reopening of the economy and the relaxation of social distancing rules, has resulted in most businesses reporting improvements in demand, from a record-low base. This is key for the summer season, which will allow businesses to continue to open their doors and trade in the weeks and months ahead.”

Hann-Ju Ho, Senior Economist, Lloyds Bank Commercial Banking, said: “While the results suggest the economy is starting to see some improvement, economic confidence still remains in deep negative territory.

“The Government announcement of the slight easing of social distancing measures has now enabled over half of businesses to reach their capacity and resume their usual activities. However, how businesses will continue to respond to the Job Retention Scheme will be key in the coming months.”

Summer Statement ‘delivers plan for jobs in Scotland’

Chancellor’s statement welcomed by Scottish Secretary but Scottish Government says the package is a huge opportunity missed.

The Chancellor yesterday set out the next steps in the UK Government’s strategy to secure Scotland’s economic recovery from coronavirus – announcing a “Plan for Jobs” to level up, spread opportunity and unite the UK.

Rishi Sunak outlined how he would focus on protecting, supporting and creating jobs as the UK enters the next phase in its recovery following the outbreak.

Delivering his Summer Economic Update, he said: “Our plan has a clear goal: to protect, support and create jobs. It will give businesses the confidence to retain and hire. To create jobs in every part of our country. To give young people a better start. To give people everywhere the opportunity of a fresh start.”

As part of a series of landmark measures the Chancellor announced that the government will:

support jobs with the Job Retention Bonus to help businesses keep furloughed workers. UK Employers will receive a one-off bonus of £1,000 for each furloughed employee who is still employed as of 31 January 2021.
expand Worksearch Support including a Flexible Support Fund and a £2 billion Kickstart scheme to subsidise jobs for young people
create jobs in the construction and housing sectors through funding to decarbonise public sector buildings, a demonstrator project to decarbonise social housing and funding to support research and development for Direct Air Capture (as announced by the PM on 30 June)
protect jobs with VAT cuts for hospitality and tourism, as well as a Eat Out to Help Out discount scheme.

The Summer Economic Update confirms an additional £800 million of Covid-19 funding for the Scottish Government through the Barnett formula.

The UK Government is now providing £4.6 billion through the Barnett formula to help the Scottish Government support individuals, businesses and public services through Covid-19.

Rishi Sunak said the plan for jobs was the second phase of a three-phase plan to secure the UK’s economic recovery from coronavirus.

The first phase, beginning in March, focused on protection with a £160 billion package of support – one of the largest and most comprehensive economic responses in the world. In Scotland this package has so far protected more than 620,000 jobs, helped thousands of businesses and paid £425 million to 146,000 self-employed people.

The Chancellor outlined that following the second phase focusing on jobs, there would come a third phase focusing on rebuilding, with a Budget and Spending Review in the autumn.

Speaking about the impact for Scotland, Chancellor Rishi Sunak said: “Since this crisis started, our wide-ranging package of support for Scotland has protected more than 620,000 jobs, thousands of businesses and paid £425 million to self-employed people.

“Today I’ve set out our plan to protect, create and support jobs across Scotland – to level up opportunity, safely reopen our economy and strengthen the Union.

“With a massive funding boost for Jobcentre Plus, doubling the number of work coaches, more people will now benefit from personalised and tailored job support. We’re investing £800m through the Barnett formula, giving Scotland the funds to create green news jobs. And we’re protecting the thousands of existing jobs in the hospitality sector with a cut to VAT and the Eat Out to Help Out scheme.”

Scottish Secretary Alister Jack said: “The measures announced by the Chancellor to support the country’s post-coronavirus economic recovery delivers for all parts of the UK.

“The UK Government’s ambitious plan for jobs, with its strong emphasis on our young people, is great news for young Scots.

“The VAT cut for tourism and hospitality will be a huge boost for Scotland. It is now absolutely essential that Scotland’s world-class tourism and hospitality industry can properly open for business.

“The stamp duty cut gives a helping hand to the housing market and building trades in England. I urge the devolved administration to use their powers to do the same in Scotland.

“And, thanks to UK Government spending decisions in the rest of the UK, Holyrood will get a £800 million cash boost, bringing their total additional coronavirus support funding to £4.6 billion.”

“The Chancellor has set out a fantastic package of support. The devolved administration now need to play its part and show they are serious about Scotland’s economic recovery.”

Responding the UK Chancellor’s Summer Statement, Scottish Finance Secretary Kate Forbes said: “We called for an £80bn stimulus package to build a strong, green and inclusive economic recovery and while there are elements in this announcement to be welcomed, in particular the measures on VAT for tourism and hospitality, overall this

“It falls well short of delivering what is needed to boost the economy and protect jobs.

“There is no new capital spend, no extension to the furlough scheme for hard-hit sectors and no further support for households in financial difficulty. A half price meal out does not help those struggling to put food on the table.

“Many of the initiatives are short-lived and do not provide long term certainty for business or households. Instead they will simply push the problems back to the end of the year when we will also have to deal with the end of the transition period with the EU.

“Despite announcing new funding measures worth up to £30bn today, most of it bypasses devolution and does not provide the Scottish Government with the funding we need to enable us to tailor an economic response that meets Scotland’s needs.

“Like all governments, we are facing huge spending pressures but we do not have the tools that others have to meet them. Along with the Governments of Wales and Northern Ireland, we set out a reasonable, proportionate set of new financial powers that would enable the Scottish Government to respond effectively.

“Regrettably, the UK Government has turned a deaf ear to those needs.”

Andrew McRae, Federation of Small Business’s (FSBx) Scotland policy chair said: “Good news has been in short supply for nearly four months. We needed action to help protect jobs and stimulate local economies across Scotland and that is exactly what the Chancellor has set out to do.

“However, it should be noted that there are many small businesses that were not supported by the Chancellor’s package – with company directors once again overlooked. Given these businesses have had little to no support in over 100 days, FSB is hoping that support can be provided in the near future.”

On the “kickstart” jobs scheme, Andrew said: “The jobs scheme will hopefully prevent a lost generation of young people, but for it to work in local economies, it must focus on the small employers who employ around one million people in Scotland. We can’t have a situation where local businesses are behind a queue of big corporates because of a target-driven approach.”

On the temporary VAT cut for hospitality and tourism sectors, he added: “Reducing VAT in sectors hit especially hard by the pandemic is an astute move. It will make everyday activities like grabbing a coffee and cake more affordable for budget conscious consumers – while making the country a more attractive destination for tourists home and abroad.”

On the discount to encourage people to eat out, Andrew said: “Scotland is fortunate to have an array of fantastic food offerings in restaurants, cafes and pubs across the country. We need to encourage more people to get back out into the community and spending money, so any moves to do this are welcome.”

The Poverty Alliance has also responded to the Chancellor’s Summer Statement. Peter Kelly, Director of the Poverty Alliance, said:“Young workers have been hard hit by Covid-19 job disruption, so the Chancellor’s announcement of a kickstart jobs scheme is welcome.

“But as the pandemic has highlighted, for too long people have been locked into poverty by low pay and insecure work. So these jobs should pay at least the real Living Wage and should have been accompanied by measures to tackle the precarious work that too many young people have to rely on.

“Part-time jobs that pay only the minimum wage cannot be a long-term solution to the problems in our labour market.

“Our recovery should be based on principles of fair work; that means redesigning jobs not reinforcing current problems.

“With the confirmation that the Job Retention Scheme is to end in October, the statement was an opportunity to fix our social security system before an expected surge in applications in autumn.

“Increasing the numbers of Work Coaches is welcome, but if we want our economic recovery to be a recovery for all, we need a social security system that loosens – not tightens – the grip of poverty on people’s lives. That means ending the benefit cap, making advance Universal Credit payments non-repayable, and ensuring that benefits actually meet people’s needs. “There is still time to make these changes before October and we urge the government to make them.

“The announcement of vouchers to support the hospitality sector falls short of expectations. At a time when more people than ever before are relying on emergency help from food banks, it is action to put cash in people’s pockets that is required, not the offer of a £10 discount on eating out.“