Scottish Covid Inquiry Hears 20,000 Small Firms Lost Due to Pandemic

Testimony presented to the Scottish Covid Inquiry indicates that over 20,000 small businesses in Scotland ceased operations following the Covid-19 pandemic. The inquiry was informed of the substantial burden placed on business proprietors who endeavored to sustain their enterprises amidst periods of lockdown and various restrictions. During the initial day of testimony concerning the pandemic’s effects on business and welfare, the Federation of Small Businesses (FSB) stated that companies encountered inconsistent access to assistance across different regions during the health crisis. The Scottish ministers commissioned this inquiry, which functions autonomously under the leadership of chairman Lord Brailsford. Colin Borland, the FSB director of devolved nations, commented that the stresses experienced throughout the pandemic affected the mental well-being of business owners. He stated, “We all spoke to people who were incredibly distressed,” adding, “If you’re running a small business it’s not just a job – your family finances are tied up in it, your family home, your vehicles, you might have family members that work there. “You’re also acutely aware of your responsibilities to your employees, your customers, the wider community, and all of that pressure bearing down on you when you don’t know what’s going to happen, when it’s going to end.” The FSB informed the inquiry that they perceived business concerns to be a low priority for the Scottish government. Borland remarked, “The idea was expressed to us that we’re the public health guys, we don’t need to worry about the economy,” and continued, “Could you imagine if that was reversed and businesses said we don’t care about public health – it would be disgraceful.” Advocating for addressing deficiencies in financial aid from both the UK and Scottish governments emerged as a “major priority” for the FSB throughout the lockdown periods. The organization noted that approximately 180 funds were managed through various entities and provided to specific businesses during the pandemic. The FSB indicated that the provision and promptness of financial assistance were “very much dependent on each local authority”. Furthermore, there were discrepancies in how support criteria were applied to businesses; for instance, the FSB cited a retail business operating from a commercial unit that did not meet the requirements for retail specific aid. Garry Clark, the FSB’s east of Scotland development manager, stated, “We had to make those arguments with local government and convince people that is actually the intention of the support.” He added that only a portion of local authorities publicized their available funds, and some established their own eligibility rules for an initial £30m discretionary fund in 2021, prior to the Scottish government releasing any allocation guidance. Mr Clark further noted, “There was very little appetite from the public sector to learn the lessons of how the first £30m was spent before the next £90m was allocated to them.” He informed the inquiry that tracing the expenditure of some business funds proved challenging. Out of £267m committed to assist businesses during the Omicron variant surge, merely £154m was disbursed, and from a £25m fund designated for business ventilation, only £1m “was spent for its intended purpose,” he reported. Craig Meikle, proprietor of Saltire soft play and football centre in Dalkeith, was compelled to cease operations for eighteen months, whereas rival businesses in an adjacent council district were permitted to resume trading. He commented, “When I think about it, it still enrages me – some of the peak insanity and rules we had to endure during that time,” adding, “I have a constant reminder of the Covid rules because I am still paying the debts we accrued during that time.” Meikle’s business remained shut for eight months before receiving any financial aid, resulting in substantial debt. Mr Meikle stated they were fortunate to endure, but the closure also affected local families, particularly those residing in apartments with restricted chances for their children to expend energy during the winter lockdown. He expressed disapproval of politicians who, in retrospect, acknowledge errors. He conveyed to BBC Scotland News, “People were saying it at the time,” and continued, “The government had their mouthpieces that they tended to listen to and any opposition seemed to be ignored at the time.” He concluded, “There wasn’t enough debate for me.” Retail enterprises were among the sectors most profoundly affected by Covid restrictions. Karen Forret’s family-operated Wilkies chain, which comprised 13 fashion and homeware stores across Scotland, saw six of its outlets fail, and its workforce of 90 decreased to under 50. She informed BBC Scotland News about the insufficient support available both during and following the pandemic. She asserted, “We’ve had no relief that English retailers and Welsh retailers have seen.” She added, “The relief came later – we’ve had to fight for it – and we were closed longer.” Forret also noted, “Out of six of the stores that we closed, five still lie empty,” and remarked, “It seems strange that we are fighting for our Scottish high streets, vital to our economy and tourism, and the Scottish government is not.” Forret stated that guidance on reopening was provided later than in other UK nations, and Scottish retailers did not receive equivalent rate relief upon resuming operations. Ms Forret concluded, “At a time when everybody was looking for support, the Scottish government failed businesses, and they have done since.” While recollections of the pandemic may be diminishing for many, this impact hearing unequivocally demonstrates that the lockdown inflicted lasting damage on the Scottish economy. The testimony presented today underscores the urgent pursuit of emergency grants once the lockdown measures were implemented. Businesses, it appears, encountered a disparity in support based on location. Various local authorities operated distinct systems. Obtaining assistance could be more challenging for those operating a business from a residence or a warehouse. For some, this aid determined whether they survived or failed. A business owner, who incurred losses amounting to hundreds of thousands of pounds during the pandemic, shared: “I’m getting angry just thinking about it again.” Consequently, this inquiry holds a vital function: identifying improved strategies to safeguard Scotland’s economy, should another pandemic occur. Copyright 2024 BBC. All rights reserved. The BBC bears no responsibility for the material on external websites. Information regarding our policy on external linking is available.