The British Chambers of Commerce (BCC) is urging the Government to give businesses much greater clarity on its roadmap out of lockdown as firms continue to suffer.
The business organisation, which represents tens of thousands of companies of all shapes and sizes across the UK, has written to the Government seeking updates on a number of vital issues.
In particular, it says firms need to know how the Government is assessing its four tests to determine if the roadmap will be followed. This includes providing regular updates on progress against the tests so that businesses can plan ahead.
Firms also need more detail on the practicalities of reopening and the government’s various reviews so they can make concrete plans on how they will operate – for example, what social distancing rules will be in place at each stage of the roadmap and beyond.
Companies are also looking to Government for clarity on potential legal issues surrounding vaccinations.
Finally, businesses which operate across the UK need the government and devolved administrations to work together on synchronising their differing routes out of lockdown.
It follows a BCC survey of more than 1,000 firms at the end of January which revealed that many firms were struggling due to the continued COVID restrictions:
- 55 per cent of respondents say they are looking to access finance over the next twelve months. Of these, almost two out of three (63 per cent) are doing so to support their cashflow and only 28 per cent are doing so to invest in products, research and development, or equipment.
- A quarter (26 per cent) of firms describe their current level of debt as either ’unmanageable’ or ‘high and manageable’. This rises to 32 per cent for consumer-facing firms like hospitality and retail.
- Almost a third (32 per cent) of all respondents said they saw write offs relating to COVID-19 lockdowns or restrictions in the last twelve months.
Of the firms reporting write offs, the mean average approximate financial value of these write offs was just over £61k, while the median average was £5k.
Of the 527 micro firms (businesses with less than 10 employees or sole traders) that responded to this question, 34 per cent of respondents said they saw write offs relating to COVID-19 lockdowns or restrictions in the last twelve months. The mean average approximate financial value of these write offs was £28.5k.
Baroness Ruby McGregor-Smith, President of the BCC, said: “The route back to a full reopening of the economy is still a long way off, with continued uncertainty about whether, and when, the roadmap steps will be met.
“Far too little has been revealed about how the Government is assessing its four tests on the roadmap for businesses to accurately judge whether it will happen as planned.
“The timescales for some firms to get ready are already short. Others will be holding out for decisions to be made around issues like international travel and tourism to finally give them hope for the future.
“The UK Government must also find a way to work much more closely with the devolved administrations in Wales, Scotland and Northern Ireland on a collective route out of lockdown. Many businesses operate across these borders, in both directions, which makes planning their restart even more complex.
“Many companies appear reluctant to invest, buy in new stock or make plans for how they will operate when so much is still unknown. They have built up huge levels of debt throughout a year of continued restrictions, seen their cashflow reduced to a trickle in some sectors, while others have been forced to absorb large write-offs due to sudden lockdowns.”