Appeal to UK Government
Ewing calls for more help for tourism businesses
Fergus Ewing: negotiations (pic: Terry Murden)
Tourism Secretary Fergus Ewing is calling on the UK Government to provide additional support to help businesses survive the economic impact of the coronavirus pandemic.
In a letter to Nigel Huddleston, Minister for Sport, Tourism and Heritage, he seeks greater flexibility, including part-time furlough arrangements to allow tourism businesses to carry on essential care and maintenance and help them prepare for eventual recovery.
Mr Ewing also says there is a lack of support for hospitality, licensed and leisure businesses with a rateable value over £51,000.
“Although not necessarily large businesses, these continue to carry substantial overheads even when closed; these costs are not mitigated by the holiday on business rates or the offset of payroll costs attributable to furloughing of staff.
“Indeed these overheads will threaten viability until lock-down ends and ‘normal’ trading can begin – even assuming that the business survives to that stage.
“We are in dialogue with industry representative bodies to explore how best we can support these businesses either through grants (perhaps linked in some way to rateable values) or CBILS which has hitherto proven not to be of real benefit to the hospitality sector.”
Mr Ewing has already raised concerns that some bed and breakfast operators are not eligible for business support as they pay council tax rather than business rates.
He welcomed Mr Huddlestone’s willingness to take up this matter with the Treasury and said it “is something we are currently exploring here in Scotland, given the importance of such operators to our sector in Scotland.”
Following discussions with the hospitality industry, Mr Ewing also asked if the UK Government plans to support the marine tourism industry, which is particularly important to remote rural and island communities, as the majority of operators do not use business premises and will not benefit from non-domestic rates relief.
“Marine tourism is largely seasonal and so cannot look forward to any form of autumn/winter recovery as boats are de-commissioned by November and not taken to sea again until Spring 2021,” he says.
“During this time there is no revenue, only storage and maintenance costs. Only a handful of these businesses will benefit from the grant scheme linked to payment of non-domestic rates. The vast majority are operated from home, a jetty or pontoon rather than business premises.”
Mr Ewing says there remains a great concern that people who have been self-employed and trading for less than two years will remain excluded from the support.
“Given the entrepreneurial nature, and very small business size, of much of Scotland’s adventure and outdoor sector in particular, this will mean that many of those businesses on which we will be relying for an early recovery will be excluded.
“A large number of such micro businesses have also registered themselves as limited companies, rather than sole traders and are also concerned that this will exclude them from the support available for self-employed people.
“It would be very helpful to know if the UK Government is looking at how we can achieve a resolution in those cases where individuals are not paid through PAYE.
“Similarly, we continue to receive a lot of correspondence from businesses which declare income on the property section of their tax return and so are excluded from the self-employment support for what they consider a technical rather than substantive reason.
“While we continue to explore how we might address these businesses and individuals through the additional support funding announced by Finance Secretary, Kate Forbes, on Wednesday 15 April, it would be reassuring to know that such gaps and omissions are also being considered at UK Government level too.”