Landlords cannot pursue Retail and Hospitality rent bills or evict businesses until 25th March 2022.
The prior date on the lifting of the ban on commercial evictions was 30th June 2021. Many businesses in the retail and hospitality sector have been unable to pay their rent due to limitations and restrictions. Their worries about eviction have been quelled due to this government announcement on Wednesday 16th.
Steve Barclay, Chief Secretary to the Treasury announced the changes and extension with the statement:
“The government now plans to introduce legislation to support the orderly resolution of these debts that have resulted form COVID-19 business closures. We will introduce legislation in this parliamentary session to establish a backstop so that, where commercial negotiations between tenants and landlords are not successful, tenants and landlords go into binding arbitration. Until that legislation is on the statute book, existing measures will remain in place; including extending the current moratorium to protect commercial tenants from eviction to 25th March 2022.
The moratorium Steve Barclay mentions was introduced in April 2020 to help struggling businesses through the pandemic and has since been extended twice. Restrictions on landlords using laws permitting them to recover rent arrears by selling a tenant’s goods will also be continued.
However, Steve Barclay wanted to reinforce “All tenants should start to pay rent again in accordance with terms of their lease, or as otherwise agreed with their landlord.”
Delay, Delay, Delay
This is one delay hospitality and nightlife businesses will perhaps be happy to see, not forgetting the PM’s announcement on Monday where, what has been dubbed as “Freedom Day” – the easing of lockdown restrictions – will be delayed until the 19th July. Most Covid-19 restrictions in England will remain in place for another four weeks. Despite the delay having a significant impact on business, the government has confirmed it will not heed calls from industry to further extend furlough and other financial support.
Hard-hit hospitality, leisure and retail firms have also benefited significantly from the current business rates holiday and ban on commercial evictions, which will also alter in the coming weeks. These firms will pay no business rates until the end of this month, with this changing to a 67% discount with a £2 million cap until the end of the financial year.
Reaction to the government action on eviction
Steve Barclay finalised his statement by saying “We believe this strikes the right balance between protecting landlords and supporting those businesses that are most in need.”
However, Shadow Chancellor, Rachel Reeves said once again the government are not doing enough. The absence of the PM was indication that the government’s economic package is lacking, showing the government are “not doing whatever it takes to support British businesses and our economy.”
Pressed on the matter, the prime minister’s official spokesperson said: “We are considering responses to a recent call for evidence on the next steps with commercial rent and we will set out response shortly.”
Hospitality and retail firms have previously warned ministers that without a further extension to the moratorium, they will face huge and unrecoverable levels of debt.
Read the reaction of NDML and NTIA to the news of the reopening delay here.
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We work with leisure and hospitality businesses across the UK,
specialising particularly in the night-time economy.
We’re number one in the sector and work closely with several industry associations to insure their members. We’re trusted by the industry because our customers know we truly care about the night-time economy. It’s our promise to you that we’ll always put you first and prioritise your business. Unlike the current view of government action. we haven’t lost compassion or human touch.