Trade groups join plea for increase to grant threshold

A new campaign is asking the UK government to increase the rateable value threshold for businesses to £150,000 (US$185,000) to support an additional 100,000 hospitality, retail and leisure firms.

Last month, UK chancellor Rishi Sunak guaranteed a £330 billion (US$398bn) package of loans and grants to help businesses during the coronavirus outbreak. For firms without pandemic insurance cover, Sunak announced cash grants of up to £25,000 (US$30,000) to support hospitality, leisure and retail companies that are below a rateable value of £51,000 (US$63,000).

Led by the Croydon Business Improvement District (BID), the new #RaiseTheBar campaign, backed by trade groups including the Night Time Industries Association, is urging the UK government to up the rateable value threshold to £150,000 (US$185,000).

The Croydon BID said the move would allow businesses the opportunity to access the government’s £25,000 (US$30,000) bursary under the Retail, Hospitality and Leisure Grant (RHLG).

The campaign is backed by industry bodies, including UK Hospitality, Beer and Pub Association, Night Time Industries Association, BID Foundation, British BIDs, and Association of Town and City Management.

The UK hospitality industry employs more than 3.2 million people, equating to 11% of UK jobs. It is the nation’s third largest sector, accounting for £130bn (US$160.3bn) in revenue, 6% of all businesses and 5% GDP.

In London alone, there are 19,000 businesses with a rateable value of more than £51,000 (US$63,000)

The Croydon BID said the current threshold is “far too low to provide adequate support to these businesses in their time of need”. An increase to £150,000 (US$185,000) would allow more than 13,000 businesses in London to benefit.

Cashflow challenges

The group said feedback from these firms implied that they were “carrying significant stock losses and are still facing immediate cashflow challenges that wage subsidies will not address”.

The organisation also said that many companies could not take on further debt and might not survive after recovery and service loans.

In addition, 80% of these businesses have been excluded from government loan support schemes due to their size or European Union policy on state aid.

Matthew Sims, chief executive of Croydon BID, said: “We acknowledge that by increasing the RHLG threshold up to and including £150,000 will increase the burden on central and local government.

“This is a price we believe is worth paying to ensure businesses are given the opportunity to become part of the greater push to mobilise our economy, rather than leaving premises empty, growing unemployment with or without the job retention scheme and sectors contracting across the board”.

To support the campaign, visit www.raisethebarcampaign.co.uk.

On Sunday (19 April), MP Michael Gove said hospitality businesses would be among the last to reopen once lockdown measures were lifted in the UK.

The founder of Hospitality Union is also asking for a non-government-funded nine-month rent holiday to save more than two million jobs.


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Author: Nicola Carruthers {authorlink}