What do our Towns and Cities need from the Budget?
Mon 1 March 2021
Ahead of Chancellor Rishi Sunak’s Budget on Wednesday 3rd March, Michael Blake, Director and Commercial Surveyor, and Richard Morgan, Planning and Development Consultant, comment on predictions and look at what our towns and cities need to not only recover from the COVID-19 pandemic, but continue to develop as vibrant hubs for both business and lifestyle.
Michael Blake, Director
The North East economy is highly reliant upon the retail, hospitality, and leisure sectors. Our larger towns and cities have suffered hugely in the last 12 months due to Covid-19 restrictions; some businesses, such as nightclubs, haven’t been able to open their doors for almost a year. The number of office workers in the main business centres has been much reduced, with Government exhortations to work from home, where possible. This combined with all but essential retail having to close for much of the period since early November, has resulted in many of our region’s centres feeling like ghost towns.
There has been some assistance with business rates relief, Government grants and the furlough scheme, but these can only go part the way to keep these affected businesses afloat. We need good news in the form of further help for the region in the budget statement.
There are reports that in this month’s budget, the Chancellor will announce an extension to the business rates holiday for the retail, hospitality and leisure sectors for a further three months from 1 April, along with a continued cut in VAT to 5% for the hospitality and tourism sectors, and a three-month extension to the furlough scheme.
These measures would come as welcome relief to these beleaguered sectors, as we emerge out of lockdown, particularly with non-essential retail not being able to open again, at the earliest, until 12 April, with pubs, restaurants and other leisure venues no earlier than 17th May, and nightclubs 21th June.
To see the region’s economy start to recover, we will need this Government’s assistance for at least three months beyond the 1st April, and preferably beyond that. In addition, the region needs further injections of Government help, perhaps with review of the business rates system, to make it more equitable, and with more Government loans and grants available for businesses, particularly in the retail and hospitality sectors.
The region would benefit from continued expenditure on its infrastructure, particularly the roads and railways, and initiatives to help some of our ailing town and City centres. Further announcements on allocation of Freeports in the region, would also be very welcome.
Richard Morgan, Planning and Development Consultant
It is widely understood that the development industry is a major driver for the UK economy and the interventions introduced in last year’s budget have been largely successful in keeping the sector buoyant, particularly the housing market as a result of the stamp duty holiday. It seems obvious that this, in combination with the other measures introduced such as the furlough scheme for example, should be continued for the foreseeable future whilst we remain under strict controls, as this has a trickledown effect in terms of consumer spending.
Beyond lockdown and when safe to do so, we need to get footfall back to our town and city centres to support businesses in retail, leisure and hospitality who have suffered huge losses since the start of the pandemic, and this will need the Government’s assistance. We need our city centres to be vibrant places to encourage growth and investment. Before the pandemic there was a lot of optimism in the North East and a real appetite for development in Newcastle in particular. If we can recover relatively quickly with help from the Government and this can be sustained, there will be a lot to look forward to with some exciting developments in the pipeline for the region.