Tuesday 14 April 2020 4:37 pm

'Unfair' Covid-19 business grant scheme means more Scottish firms could go under

Concerns are growing among Scottish businesses that the SNP government’s failure to match Westminster’s coronavirus economic support will force a string of retail and hospitality chains to go bust.

English hospitality, tourism and leisure chains have been offered government grants of up to £25,000 per property, as long as the building’s rateable value is less than £51,000. This means a pub chain with four venues could receive £100,000 through the scheme.

Read more: Coronavirus: UK economy could shrink by 35 per cent in second quarter

However, the Scottish government’s equivalent programme is giving out grants per business and not per property, meaning the same chain in Scotland with four venues would only receive £25,000.

This is despite chancellor Rishi Sunak giving the Scottish government £2.2bn for the relief package and despite assurances by Scottish economy minister Fiona Hyslop that Scotland would be “replicating [England’s] package of measures in full”.

A petition deriding the the u-turn by first minister Nicola Sturgeon and finance minister Kate Forbes has now received 10,000 signatures and has angered parts of the Scottish hospitality sector.

Kevin Doyle, director of pub and restaurant chain Caledonian Heritable, said the Scottish Government’s decision is “fundamentally unfair”.

“More of us will go under because of this than down south,” he said.

“Any company that is multi-operational in Scotland has been disenfranchised and will really struggle.

“It’s tough for us, because we’ve made decisions about pay and staff on the assumption we were getting these grants.”

Forbes, who was only appointed Scottish finance minister two months ago, made the decision to also distribute the £2.2bn pot from Sunak to businesses in industries other than hospitality, tourism and retail.

Now, small businesses from other sectors are eligible to receive money that otherwise would have been earmarked for venues forced to close during the coronavirus lockdown.

The move has raised concerns in Westminster, with the government and Labour both criticising Sturgeon and Forbes for the policy.

Scottish secretary Alister Jack said the Scottish government has “serious questions to answer about the operation of their support schemes” and that he was “extremely concerned” about the effect it would have on Scottish business.

Shadow Scottish secretary, and Labour’s only MP north of the border, Ian Murray said: “Scottish employers are worried, angry and bewildered about the Scottish Government’s decision.

“The loss of these businesses and jobs could be catastrophic to local economies and communities in Scotland.”

Forbes defended her decision and said it was made to “ensure more efficient use of limited resources”.

She said: “Because there are more businesses eligible for the £10,000 grant in Scotland due to the more generous Small Business Bonus Scheme, and recognising the other business support available to cover wages, we have decided to limit the £10,000 and £25,000 grants to one per business.

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“This has allowed us to offer support to other important sectors, including aviation and fishing, which are not receiving support elsewhere in the UK.”

The Treasury was contacted for comment.

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