Liverpool is to provide £40m of emergency funding for hospitality and leisure businesses in the region, allowing those affected by local lockdown restrictions to ‘top up’ employees’ wages.
The city’s metro mayor Steve Rotheram has stated that the wage subsidies provided by the government’s expanded Job Support Scheme were not enough to support staff affected by Tier 3 lockdown restrictions, which began in the region yesterday and have forced businesses including pubs, bars, gyms and betting shops to close.
Covid-19 impact on jobs
The emergency fund had been agreed and readied for launch last week, but the mayor and the leaders of the city region’s six local authorities had waited to see what support the chancellor would unveil in his speech last Friday.
The fund aims to enable viable businesses to continue trading and retain as many jobs as possible; support temporarily closed businesses to top up employees’ wages and remain solvent; and to assist economic recovery across the hospitality and leisure sector in the future.
It will be in place for up to four months, until a “wider and more substantial” package of support can be secured from central government, the Liverpool City Region Combined Authority said.
In a joint statement, the metro mayor, city mayor and leaders of the region’s six local authorities said: “The furlough scheme announced by the chancellor last week falls far short of what our region needs and deserves. If 80% was the right level of support back in March, then it should be in November. Lots of the people affected by these new restrictions will be in low paid, insecure work and it is deeply unfair to expect them to survive on two-thirds of the minimum wage.
“We will continue to fight for a more comprehensive funding package, but in the meantime, where the national government has stepped away, we, as local leaders, will step up.
“We know that once a business is gone, they are gone, and we must do everything we can to prevent that. Our hope is that this fund can provide some interim support and will mean local businesses and their staff survive in the coming weeks and months, until the government does the right thing.”
Applications for grants will open on their own local authority websites at 10am on Friday 16 October and will close at 5pm on Friday 30 October.
Claimants must be a small or micro business in hospitality and leisure, based in Halton, Knowsley, Liverpool, Sefton, St Helens or Wirral. They must have at least one full-time equivalent employee; be a business to consumer firm; be trading as a going concern and trading from a commercial premises.
Pub and brewery group Marstons is among the first major employers to indicate how much it has struggled amid the closures in Liverpool and areas of Scotland, and the 10pm national curfew. It said around 2,150 furloughed employees would lose their jobs.
Marstons said: “The introduction of these further restrictions and guidance affecting pubs is hugely disappointing in view of a lack of clear evidence tying pubs to the recent increase in infection levels, and our own data which suggests that pubs are effective in minimising risks.”
Last week Rotheram, Greater Manchester metro mayor Andy Burnham, the leader of Manchester City Council and the mayors of Sheffield, North of Tyne urged the government provide more support for workers affected by enforced closures and reduced business hours.
They said in an open letter: “We cannot understand why people whose place of work is forced to close by government-imposed restrictions are only being offered two-thirds of their wages.
“While it may be possible for people on middle or higher earnings to live on two-thirds of their salary, that is not the case for the low-paid staff who work in hospitality. They do not have the luxury of being able to pay only two-thirds of their rent or their bills.”
Without further intervention, there is a risk of “significant” redundancies and multiple business failures, which would plunge residents of northern regions into “severe hardship in the run-up to Christmas”.
“That would cause long-term damage to the already fragile economies of large parts of Northern England and weaken the recovery when it finally comes. It would do the precise opposite of what the government was elected to do and level down the North,” the letter concludes.