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Government support 'vital' in keeping businesses in UK coastal cities alive post-pandemic

Suban Abdulla
·4-min read
A seagull looks out to sea at Hythe Waterfront, Hampshire whilst the pier train runs in the distance
Jobs in tourism generate up to 50% of local employment in some coastal areas in the UK. Photo: Getty

A new parliamentary report has outlined the impact of COVID-19 on businesses in UK coastal cities.

The report by the All-Party Parliament Group (APPG) for hospitality, shows that the impact of the pandemic has been more pronounced on coastal and lakeside regions due to their reliance on tourism.

Jobs in tourism generate up to 50% of local employment in some areas.

These regions are likely to bounce back from the current crisis more slowly than other parts in the UK, with one-third of coastal communities yet to recover from the financial crash of 2008, the APPG report said.

UKHospitality’s research stated that government support for tourism and hospitality businesses, in particular the VAT cut and business rates holiday, has been vital in helping businesses survive.

Crucially, it called for an extension of the current VAT cut as well as a business rates holiday for the whole of 2021 to enable businesses to rebound next year.

The group raises concerns over the post-pandemic socio-economic struggles these regions will face, with many issues present in these areas being exacerbated by COVID-19.

To tackle the challenges ahead, the group called on the government to take a number of steps, including revitalising the Tourism Sector Deal to create an effective plan to boost coastal and lakeside communities.

It also urged the government to commit to a coasts and waters strategy as part of its “levelling up” strategy, and examine innovative ways to increase demand for off peak tourism to these areas, including the introduction of social tourism vouchers for lower income families.

Chair of the APPG, Steve Double MP said: “This has been a comprehensive investigation into the challenges and opportunities being faced by tourism and hospitality businesses in coastal and lakeside communities.

“The work this year has also thrown into sharp relief the devastating effect the ongoing COVID-19 crisis has had on these fantastic, yet precariously balanced regions. Without the further assistance that we have called for, many businesses and jobs in the hospitality and tourism sectors will not exist by Spring 2021. Without these vital industries, coastal and lakeside areas across the UK will be thrown into penury.”

Double said that the report “gives us the best chance of understanding” how these communities can be “supported and encouraged to grow.”

Watch: Why tax rises may be inevitable in Britain

Beyond the coronavirus crisis, the report also highlights deficiencies in infrastructure, particularly the lack of transport links and poor digital connectivity, and a risk of climate change as major concerns.

Members called for an urgent need to tackle seasonality which limits productivity, employment, investment and skills in coastal and lakeside communities.

The Coasts and Waters report also focused on representation of these regions in government. With the group recommending that there should be a new cabinet position created for a coastal communities minister.

READ MORE: UK government launches £4bn 'levelling up' fund for England

Kate Nicholls, chief executive of UKHospitality, which acts as secretariat to the APPG, added: “Seaside and lakeside hospitality is some of the best the UK has to offer. Importantly, these businesses tend to account for a significant proportion of the revenue raised in their areas. They are vital attractions for visitors, important hubs for communities and crucial drivers of inward investment.

“They have not always had the support they need and deserve, though. They have had to battle through against lack of investment, fluctuating demand and changing tastes. If the COVID crisis has made anything clear, it is that hospitality and tourism businesses are vital parts of communities and will be essential in rebuilding the economy next year and beyond. Coastal and lakeside communities need to be at the heart of plans to bounce back strongly.”

It comes as prime minister Boris Johnson announced that the second England lockdown will end on 2 December. Cities and regions across the country will be moving into different tiers depending on virus infection rates.

On Wednesday, UK chancellor Rishi Sunak announced a new £4bn ($5.3bn) fund to finance local community projects across England, as part of the government’s spending review.

The Treasury said local communities will be able to bid directly for funding for projects in their area. The fund will favour “places in need, those facing particular challenges, and areas that have received less government investment in recent years.”

The England fund announcement came as Sunak set off government departmental spending for the year ahead and warned that the “economic emergency" caused by the pandemic was only just beginning.

Watch: Spending review 2020: Five announcements that drew strong reactions