Wednesday 30 September 2020 4:00 am

Sunak’s subsidy scheme will save just one job per company in the business travel sector

Clive Wratten is chief executive of the Business Travel Association.
CEO, Business Travel Association

Last week, the chancellor outlined his Winter Economy Plan — trying to balance the needs of the economy with our health and wellbeing. No enviable task. 

Listening to his polished performance in the Commons, it would be easy to conclude that the chancellor’s new approach — underpinned by a Job Support Scheme and extended tax breaks — provides a workable set of actions that could successfully supersede the furlough scheme. 

Rishi Sunak, along with his economists, officials and advisors, would have us believe that it was a well thought out plan. Suggesting that, while not all jobs could be saved, succour was available to preserve many.  

Sadly, such a blanket approach blithely ignores the complexities and vagaries of the UK economy. Not all sectors in our economy have been affected equally. Some have tackled mild headwinds, whereas others have battled violent storms. 

Read more: Economists raise fears over Rishi Sunak’s new job support plan

The business travel industry which I represent has been battling economic turmoil for months, desperately seeking ways to stimulate safe journeys. Quarantine, lockdown, and working virtually have all placed huge pressures on jobs in our industry. 

While the furlough scheme did provide help in keeping some jobs in place, by the early summer, more and more were at risk. 

We have seen year-on-year demand for business travel fall by 90 per cent and travelling to all major business cities — bar Frankfurt and Singapore — requires extensive quarantine. 

Many of my members wanted to see the furlough scheme extended, but the Treasury was adamant — no extension. Yet we argued all summer that the travel industry — along with hospitality, retail, and events — deserved special measures, because of the disproportionate impact of Covid-19 on them. 

We wanted a package that didn’t put the onus on the British taxpayer, but brought government support to the sectors struggling the most. We proposed innovative and targeted solutions.

In the hours after the Job Support Scheme announcement, there was still some hope. It was short-lived.  Our members’ spreadsheets now show that, on average, the scheme will save just  one job per business travel company. We still expect 50 per cent of people in our industry to lose their jobs. Worse may come in the new year.  

Read more: The government’s short-term ‘cures’ are doing far more damage than the virus itself

The business travel sector, which contributes £220bn annually to UK GDP, now faces decimation. A situation made worse by the promise of increases in Air Passenger Duty next April. 

Yet, unlike Mr Sunak who has been complacent with his blanket approach that ignores the need for targeted solutions, the business travel industry will not stand back and watch jobs being lost. 

We fight on because we do not want the UK to miss out on crucial trade deals in a post-Brexit world. We believe there are safe and achievable ways to stimulate business travel. We believe that every job we save will have a positive impact on the wellbeing of our nation. 

As we approach the winter, with a vaccine just out of reach, it is time we again put our own tailored solutions on the table. 

Looking across Europe, we see our neighbours seeking to re-energise their economies. How? By implementing testing at airports which enables people to live alongside the virus while opening vital trade corridors. 

Covid-secure travel would make a significant difference to the UK economy and save jobs. 

This is not “pie in the sky”. Trials are underway at Heathrow, and there is the technology and capacity to deliver a testing on departure pilot at airports across the UK. 

Such tests are conducted by private companies and funded by travellers themselves. There’s no impact on the NHS’s capacity to test those who need it most, but instead, the ability to share information with them and keep us moving.

Yet our government has failed to grasp this opportunity, and dumped testing for travel in the “too difficult” pile. 

But, come on Mr Sunak — now is the time to give testing a go. 

Main image credit: Getty

City A.M.'s opinion pages are a place for thought-provoking views and debate. These views are not necessarily shared by City A.M.

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