Property trade bodies have rallied to urge the government to stump up £1.75bn to pay 50% of unpaid rents across the hardest hit sectors to avoid a “rent crisis”.
The British Property Federation, British Retail Consortium, Revo, ukactive and UKHospitality claimed that should the government fork out the cash, it would provide a £7bn total return to the Treasury in terms of tax revenue and economic activity and save 375,000 jobs.
The trade bodies said the grants should be given to hospitality, leisure and retail businesses, as many cannot afford to pay rent.
Without financial support from the government, both tenants and landlords could “face the very real risk of business failure”, as well as “hundreds and thousands of job losses and long-lasting damage to high streets across the UK”, the trade bodies group said.
The proposed Property Bounceback Grant would see government paying up to 50% of rent and service charges between March and September. Meanwhile, landlords and tenants would pay the remaining 50% of rent and services charges through the government’s Code of Practice.
Should support be extended even further to cover businesses that have already reached rent payment agreements, the government would need to provide £4.7bn of funds – but this would provide a total return of over £11bn to the UK economy and save over 630,000 jobs, the trade bodies claimed.
In a joint statement, the trade bodies said: “Many landlords and tenants are working collaboratively to agree new payment plans, but there remains a significant proportion of rent unpaid. Many businesses will never be able to pay this debt and many landlords cannot afford to sustain losses of this scale. Government must step in and provide rent support, otherwise we will see more businesses closed, more jobs gone, and more high streets devastated.
“Without urgent action on rents, many otherwise viable businesses are, through no fault of their own, at imminent risk of failure. Where both landlord and tenant are able to cover at least 50% of the rent owed, and are able to demonstrate they are working together as economic partners, government should have the confidence to invest in these businesses’ futures and prevent the needless loss of hundreds of thousands of jobs.”