At an oral evidence session for the Business, Energy and Industrial Strategy Committee, three business leaders in the fields of property, hospitality and retail spoke to MPs, explaining that lockdown had pushed a number of businesses in the hospitality sector into more than £10 billion of debt.

Even in the event of looser restrictions after 19th July, dubbed ‘Freedom Day’ by some, these business leaders were of the view that more businesses were poised to collapse unless the government undertook reforms to ensure they had sufficient support.

Time is of the essence

With furlough payments and business rate relief starting to unwind already from early July, Kate Nicholls of the trade body UK Hospitality warned MPs that reforms would need to start by the summer on issues such as rental debt, as pressure was already building on vulnerable businesses in the sector. Not only do businesses face a rental bill to private landlords – many have taken out billions of pounds in government-backed loans.

While these measures helped supress the number of insolvencies and bankruptcies during the last year, like a coiled spring, such events could come back in larger numbers, especially as there is uncertainty about how a large number of unpaid rental bills can be repaid. The government is facing scrutiny over its handling of this issue, especially as it announced plans to help resolve it with a form of binding arbitration process, but there is scant detail as of late-July.

The introduction of new rules coinciding with the 19th July easing has led to confusion, with business owners of bars and clubs urging for clarity on how to enforce them. At a time when the UK is already experiencing a third wave of COVID-19 with the Delta variant spreading, there are valid concerns about how to ensure party-goers can enjoy a night on the town without contributing to the spread in cases.

A new wave

Some of the new rules causing some confusion pertains to the use of facemasks and social distancing, and businesses are keen to avoid being the recipients of backlash from members of the public who take issue with changes in rules. Businesses will be keen to limit the exposure to risk concerning COVID-19, especially given issues relating to the NHS COVID-19 app.

If a person is ‘pinged’, or notified of having scanned into a venue and having been in the presence of someone who tested positive for COVID-19, they would be expected to isolate for several days. For a business short on staff with a surge in new customers, losing a chunk of your workforce in one fell swoop due to the app pinging them.

Time will tell whether Freedom Day is the great success as hoped by many, or just the start of what could lead to something of a logistical headache for consumers, the government and businesses alike. Whatever comes of it, businesses will be doing what they can to preserve the health and safety of their customers while also bringing in the punters.