25 Nov 2020
By Stuart Patrick, Chief Executive of Glasgow Chamber of Commerce
Somewhere around the 20-mile stage is the point in a marathon when runners hit the wall as their stored energy runs out.
I can’t vouch for that having never attempted one but for many businesses now enduring a Level 4 lockdown in Glasgow and in 10 other local authority areas there will be a grim appreciation of how it must feel.
Any small business that depends on Christmas trade to build up cash reserves to survive the new year’s first quarter will now be, as Scottish Chambers of Commerce’s chief executive Liz Cameron says, “running on fumes”. The good news is the imminent arrival of several effective vaccines and the growing promise of an end to the pandemic perhaps as early as the spring.
But there are at least four months to get there and who can guarantee that in early January businesses won’t be shut down again to deal with the increase in cases from a Christmas relaxation.
Business support for both the Scottish and UK governments’ response to the crisis is in decline according to Fraser of Allander’s October Scottish business monitor for Addleshaw Goddard. The Scottish Government gets more credit for its response to the health crisis itself – certainly more than the UK Government – but the figures are reversed when it comes to the issues facing business. The Scottish Government gets only 4.1 out of 10 for its understanding of the challenges faced by business and 4.4 for the support that it offers.
That chimes with the response we have been hearing from our members. The evidence explaining which business settings are causing the virus to spread remains thin and when businesses have invested in equipment, staffing and training to make their premises safe it matters a great deal that the implication is that businesses are at fault.
The vast majority faithfully followed government’s guidance and would like to know what more they should be doing to stay open.
Equally common are questions about the effectiveness of the Test and Protect system which businesses have been gathering data to support. Regular comment is that there has been no contact from the system – even for businesses that have collected several hundred thousand customer details. Businesses made their commitment to safety and now doubt that the Test and Protect system delivered.
Nor is the business support compensating for the costs of closure. An extra £30m was announced by the Scottish Government but given the number of businesses seriously affected by Level 4 lockdowns and the associated travel restrictions the amount the average business will receive will be marginal.
The job retention scheme is always welcome but the additional small cash grants simply don’t come close to covering fixed overheads. I don’t envy the task of local authorities once again being given very short notice to distribute these grants and on a discretionary basis.
Once both governments have decided how Christmas is to be managed, more time and energy should be invested with retail, hospitality, tourism and other badly affected sectors in examining how rapid mass testing can be used to help consumer-facing businesses stay open in the face of the third wave that the World Health Organisation’s envoy David Nabarro predicts for Europe early in 2021. Failing that, a much better package of financial support will be needed, including larger cash grants for the remaining winter months, and commitments to businesses that had to close that there will be rates relief in 2021/22.
Runners avoid the marathon wall with careful planning and there is still time to do the same for Scotland’s business community.
This article was first published in the Herald Scotland on 25 November 2020.
