Tuesday 13 October 2020 3:22 pm

More than half of London businesses ‘are not prepared’ for local lockdown

Almost 60 per cent of London businesses have no plan in place for a local lockdown, according to new research, as the London mayor today warned the capital could see tighter restrictions within the next few days.

Only 41 per cent of companies in the capital currently have a plan in place to deal with a potential London lockdown, according to government-backed campaign Driving For Better Business.

Read more: Majority of UK businesses to scrap working from home post-pandemic

More than a third of London firms said they were concerned that a local lockdown would prevent them turning a profit, following months of crippled business during the nationwide lockdown earlier this year.

A third of 150 companies surveyed said a total shift to working from home under a London lockdown would compromise effective business management.

Meanwhile 42 per cent said a city-wide lockdown would hamper current efforts to recover from lost business so far this year.

The figures put London slightly ahead of the rest of the country for local lockdown preparedness, with just 39 per cent of UK businesses surveyed across the rest of Britain saying they had contingency plans in place.

Simon Turner, campaign manager at Driving for Better Business, told City A.M: “It’s concerning that although London is ahead of the curve when it comes to containing the virus, the statistics show a limited level of preparedness by businesses for… localised lockdowns, mirroring what is shown at a national level.

“Firms need to adapt quickly in the current environment and take every opportunity to minimise operational costs and improve efficiencies in order to give them the best chance of survival.”

Tiers for fears

It comes after Prime Minister Boris Johnson yesterday introduced a new three-tier system for assessing the need for local lockdowns around the UK, following a sharp spike in infections across the country.

Liverpool and Merseyside were designated the highest alert level yesterday with just 48 hours notice. Both indoor and outdoor household mixing will be banned when the tier system comes into effect tomorrow, while pubs, bars and restaurants will be forced to close.

Puregym, Britain’s largest gym chain, today slammed the last-minute move, saying it was “extremely disappointed” to have to close its seven sites in the Liverpool area.

Greene King, which operates more than 3,000 pubs across the country said new restrictions dealt a huge level of uncertainty for the business.

Chief executive Nick Mackenzie said: “Once again pubs have been unfairly hit and, after [yesterday’s] announcement, our team members and tenants face yet more uncertainty.

“We need urgent clarity on further financial support as this isn’t just about the tier three regions – pubs across the country are becoming increasingly unviable with the restrictions being placed on them.”

Trade body UK Hospitality, which represents around 65,000 venues and 3.2m jobs across Britain, slammed the local lockdown system for putting jobs at risk.

“We are now on the brink of widespread job losses,” said chief executive ate Nicholls. “Half a million jobs in the hospitality sector are on the verge of being lost. We need much more wide-ranging support for businesses struggling to operate amidst stifling restrictions.”

London

London is expected to be initially placed on “medium” alert when the system comes into force tomorrow.

However, mayor of London Sadiq Khan today warned that the capital could escalate up the chart “very quickly – potentially even this week”. 

Mixing between different households or social bubbles will likely be banned indoors, including in pubs and restaurants, if London is moved to “high” alert.

A spokesman for Khan said: “The virus is now spreading very quickly in every corner of London. The number of cases is rapidly increasing and all the indicators we look at are moving in the wrong direction.”

Business bodies have warned against imposing fresh lockdown measures in the capital over fears new restrictions will decimate the British economy.

The City of London Corporation yesterday urged the government to protect livelihoods as well as lives, warning that “hibernating through the winter is not an option for our economy”.

“Employers have dedicated considerable resources to deliver Covid-secure workplaces and to restore confidence among their staff,” said Catherine McGuinness, policy chair at the City of London Corporation.

“A blanket recommendation to work from home over any significant length of time risks stalling the capital’s recovery and damaging long-term competitiveness.”

McGuinness said tier restrictions should be “regularly reviewed in light of the evidence”, adding: “The virus is not going to go away quickly, so we need to find a way to live with it.”

It comes after the latest data from the Centre for Economics and Business Research (Cebr) showed that coronavirus created a £2.3bn spending hole in London between March and July, as shops remained shuttered under lockdown.

Read more: Second local lockdown could cost London more than £2bn

Cebr chief executive Nina Skero said: “Virtually everybody that could was working from home, so we estimate that the lost spending during that period was more than £500m per month.”

“All of the spending on restaurants, hairdressers and other services was almost entirely lost as people were confined to their homes,” she added.

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