Labour has today accused the Chancellor Rishi Sunak of consigning whole sectors of the economy, which generate billions in tax revenue and employ millions of workers, to the scrap heap.
In his Winter Economic Plan, the Chancellor failed to mention businesses that are not able to operate, because they are either shut down completely or trading with hugely reduced capacity including the weddings industry, events and exhibitions, major parts of the night-time economy, festivals, sports venues and theatres. There was no acknowledgement at all about their plight or the fact that they will be forced to remain fully or mainly closed for the next six months.
New analysis by the Labour Party, using Office of National Statistics employment data shows that more than a million workers are in these sectors simply dismissed as “unviable” by the government. None of the additional measures announced by the Chancellor last week will assist them. The government’s Job Support Scheme is only open to those employers who offer their employees at least a third of their usual hours – impossible for those industries still closed. The scheme is also fundamentally flawed because, for every two members of staff, it is cheaper for a company to bring back one member of staff full-time and fire the other than to have two workers working part-time.
The failure of the government to implement an effective Test, track and trace system means that these businesses do not have any idea of when they can safely reopen.
Labour is highlighting the viable industries and employees in the East of England the Chancellor has abandoned are:
- The UK’s nightlife industry – including 7,000 people employed in nightclubs, 45,000 people employed in pubs and bars. Either still shut down or operating at reduced capacity and now hit by 10 pm curfew.
- The events industry – including 8,000 event caterers, 1,000 people organising and running exhibitions and conferences.
- The creative, arts and entertainment sector including theatres and cinemas – still shut-down or operating at reduced capacity – employing 8,000 people.
- The wedding industry – The number of employees is too difficult to capture from available statistics but includes caterers, florists, photographers, dressmakers, and suppliers of all kinds. The industry has been hit by new restrictions: the number of wedding guests has been halved from 30 to 15, which will hit at least 70,000 weddings. It has been estimated the UK’s wedding industry has already lost an estimated £4.8bn as a result of coronavirus, with 127,000 nuptials postponed to 2021.
- The sports industry – employing 34,000 people.
Labour can also reveal the number of businesses across the East of England dismissed by the Chancellor as unviable:
- 580 nightclubs, still under lockdown and therefore unable to access the Job Support Scheme
- 70 cinemas operating at hugely reduced capacity
- 3,500 pubs and bars hit by the new 10 pm curfew
- 2,420 creative and arts venues in many cases still closed
Lucy Powell MP, Shadow Minister for Business and Consumers, said:
“The Chancellor is consigning whole sectors of our economy to the scrap heap, damaging lives and livelihoods, and threatening the recovery. The failure of Ministers to ensure an effective Test, Track and Trace system means that many businesses are still fully or partially shut down. The decision to shut these firms out of the Job Support Scheme adds insult to injury.
“Labour has called for the government to come forward with an effective plan to recover jobs, retrain workers and rebuild businesses. This isn’t it. Even for those who can access it, the Job Support Scheme is badly designed and could lead to a wave of job losses, because the Chancellor’s sums do not add up for businesses. He must think again before the jobs crisis reaches the tipping point.”
Shadow Culture Secretary Jo Stevens said:
“The UK’s cultural sector is a critical part of our national identity – not to mention a valuable part of the economy.
“These are skilled, specialist jobs in an industry that had been growing until the COVID crisis hit.
“So far the government has promised money to prop up our theatres and concert halls but it’s the people who work in them who are suffering and who are excluded from government help. The sector is braced for a winter of further job losses.”