Business support has 'too many holes', says East London Trades Guild

Chancellor of the Exchequer Rishi Sunak leaves 11 Downing Street, London, ahead of delivering his on

Chancellor of the Exchequer Rishi Sunak leaves 11 Downing Street, London, ahead of delivering his one-year Spending Review in the House of Commons. - Credit: PA/YUI MOK

Hackney business owners have voiced their concerns over the government's support for businesses as the UK enters its third national lockdown.

£4.6 billion in lockdown grants are to be distributed to support businesses and protect jobs, with grants of up to £9,000 available to retail, hospitality and leisure sector firms based on rateable values. 

But some businesses, like the Five Points Brewing Company in Hackney Downs, are not eligible - and still have bills to pay.

Operations manager Ben Winders said: "We need a road map out of this so we can plan how we make it out the other side. We need to plan for staffing, ingredients and logistics."

He says breweries like Five Points will not benefit from the 100 per cent rates relief provided to retail, hospitality and leisure businesses, beer duty relief or VAT deduction - which has seen food reduced to 5pc VAT but alcohol remaining at 20pc VAT. 

A ban on the sale of takeaway pints from pubs until the possible lifting of lockdown in February will also take away "a vital lifeline for draught sales", Ben said. 

"You can go into a busy supermarket or off-licence to purchase beer to takeaway, but not order through a pub window with Covid-safe plastic screens," he added.

Sustainable swimwear company Usual Objections, a self-funded start-up near Finsbury Park, is also not eligible for grants or loans as the business operates out of the home of  it's co-founder Linda Souto Maior.

Founders of Usual Objections stand in front of designs and sewing equiptment

Richard Keegan and Linda Souto Maior run their start-up sustainable swimwear company Usual Objections from their home on the border of Hackney and Islington. - Credit: Liz Seabrook/lizseabrook.com

Linda launched an online shop in March 2020, having spent three years setting up the small manufacturing studio.

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She cannot access various support schemes, such as business continuity loans as the company is still in its infancy, despite having invested £100,000 in machines and stock. 

She told the Gazette: "During the first and second lockdown, all swimming pools were closed, and during the summer almost all events were cancelled so we lost a significant source of revenue and marketing opportunities.

"Many cancelled summer holidays also further damaging sales."

The government says a further £594 million will be made available to local authorities to support businesses not eligible for grants but still affected by restrictions.

The new one-off grants come in addition to existing support already available, including of up to £3,000 boosts for closed businesses.

On January 5, Chancellor Rishi Sunak said: "The new strain of the virus presents us all with a huge challenge - and whilst the vaccine is being rolled out, we have to tighten restrictions further."

He announced that the recent "cash injection" will support businesses until the spring to get them "through the months ahead" and sustain jobs for when they reopen. 

Krissie Nicolson, founder of East End Trades Guild - a co-operative of small independent traders in East London, said the guild welcomed the support from central government but that suppliers to the hospitality and retail sector, such as small brewers, have been overlooked in handouts.


Usual Objections founder sewing a garment in home studio.

Usual Objections is not eligible for government loans or grants as it is is a new company, despite having invested £100,000 in equipment to set up their home manufacturing studio. Liz Seabrook Lifestyle and portrait photographer lizseabrook.com +447515528803 - Credit: Liz Seabrook/lizseabrook.com

She said: "It's too soon to tell if this has been addressed this time around.

"It's the same issue for all small-scale manufacturers and industrial businesses who are all particularly important to the local supply chain.

"They are small businesses but need larger industrial premises for machinery, which means they are regularly excluded from support as the rateable value of their properties is above the threshold, yet their orders have dropped off a cliff.

"The way our economy is organised means that although support from government is generous, there are too many holes in the net for it to slip through to create a sustainable recovery."

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