UKHospitality calls on business secretary to extend coronavirus loan repayments
The chair of UKHospitality has urged the government to extend CBILS (Coronavirus Business Interruption Loans) repayment terms to ensure the "survival of thousands of businesses in hospitality".
In a letter to the secretary of state for business and trade sent on 10 July, Kate Nicholls wrote that "a substantial number of businesses" are still repaying bounceback loans and CBILs when interest rates on repayments have now risen to "around 8%-10%".
She has also criticised the "inflexibility from HMRC" on the application of Time To Pay concessions on businesses that have adhered to the documentation of cashflow.
It comes after Sky News reported yesterday (13 July) that 3,347 restaurants failed to pay their debts in the past two years to March 2023, amounting to an average of six restaurants a day for the first three months of 2023, based on figures from the Insolvency Service.
Nicholls said: "We propose that the government work with the British Business Bank to put forward a new set of conditions for the extension of CBILs, with a presumption in favour of extension for businesses that have adversely, in the short-term, been affected by the energy crisis.
"This should also have no impact on a business's credit rating as it would be considered a standard re-financing. Alongside this advice should be given to HMRC to take a more lenient approach to Time To Pay."
She added: "A further measure to support business at this time would be to extend the guidance the chancellor gave to banks in relation to mortgages, with no fault payment delays, to business customers."
Nicholls stressed that hospitality is still under "extreme pressure" as a result of high energy prices, citing UKHospitality's latest member survey, which revealed that 30% of businesses expressed fears over the failure of their business in the next year, with 94% of responses linking this to the energy crisis.
She has offered to meet with the business secretary, as well as arranging bilateral conversations with affected businesses in order to ensure "the survival of thousands of businesses in the hospitality sector".
