Mayor John Biggs today wrote to the Chancellor and called for him to step in and extend support for businesses hit by the economic impact of Coronavirus. In the same week the furlough scheme started to be wound up, the Mayor highlighted his concerns that the ‘one-size fits all’ approach from the government of removing support for businesses would risk jobs and choke off any recovery while the UK is in recession.

Since March, the Coronavirus Job Retention Scheme has paid 80% of the wages of workers placed on leave, up to a maximum of £2,500 a month. From September that is going down to 70%, with the employer paying 10%, and then the scheme will finish at the end of October creating a cliff edge for businesses. Around 40,000 jobs in Tower Hamlets have been furloughed during the lockdown.

In his letter the Mayor expressed his concern that a sudden removal of the support schemes “represent a one size fits all approach and the government needs to look at each sector individually’’. At the same time the ‘Eat Out to Help Out’ scheme, which provided a boost to restaurants, has now ended. The Mayor highlighted the plight of high streets and markets suffering from reduced footfall due to lockdown and reduced numbers of commuters in Tower Hamlets.

During the Coronavirus pandemic the council has supported local businesses by distributing over £57m worth of business grants. The council has recently introduced temporary pedestrianisation on part of the Brick Lane so restaurants will be able to move tables and chairs onto the street to encourage more people to eat there in line with social distancing rules.

Mayor John Biggs said:

I’ve written to the Chancellor to argue the case that further government support is needed for businesses due to the unprecedented situation they find themselves in. As a council we’ll be working with our community to promote our iconic town centres and markets as they are a jewel in the crown of our borough and we’ll do what we can to support them. It’s going to be sink or swim time for a lot of businesses and we need government to provide backing for them too at this crucial time.”

Cllr Motin Uz-Zaman, Cabinet Member for Work & Economic Growth said:

“The East End is a resilient place but businesses will suffer if government withdraws support too quickly. We’ll continue to work to ensure our economy weathers this storm but it would be short-sighted for the government to step back now and put jobs at risk.”


Full text of the letter sent from Mayor Biggs to the Chancellor:

Dear Chancellor,

The impact of Coronavirus and the lockdown has as you know caused a huge and unprecedented economic shock. It was right that the government took steps to mitigate the negative impact to people’s livelihoods by putting in place measures to protect jobs and stimulate the economy. However I am extremely concerned that withdrawing this support across all sectors at the same time will cause huge damage to our economy here in Tower Hamlets.

The Furlough scheme and the ‘Eat Out to Help Out’ schemes have been welcome but I am concerned that a sudden removal of these represent a ‘one-size fits all’ approach and the government needs to look at each sector individually.

I call on you to consider extending the Furlough scheme as has been done in other European countries to protect jobs and come up with a clearer plan for each sector of our economy. In a borough like mine reduced footfall from people not commuting and a reduction in tourism means specific support should be considered to protect our vital high streets and markets.

I also urge you to offer further packages like ‘Eat Out to Help Out’ and additional discretionary funding so we can stop businesses going under. It’s going to be sink or swim time for a lot of our businesses and they need your support .

I also urge you to look at providing further grants for small businesses. Investing now will protect businesses and jobs ultimately preventing businesses from closing down, saving the government the cost of increased benefit payments in the long run.

I look forward to hearing from you.

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