With the UK adopting more stringent measures to protect its population from Co-Vid 19, the Government must urgently consider acting as the insurer of last resort for the UK’s leisure sector which will face unprecedented difficulty in the weeks ahead, accountancy and advisory firm, BDO LLP said today.
The warning comes today as the Government is set to announce more financial measures to help the economy during the coronavirus outbreak, amid concerns the latest restrictions could put firms out of business.
Boris Johnson has urged everyone to avoid unnecessary social contacts, to work from home where possible, and to stay away from pubs and restaurants.
The leisure sector, which has many world leading companies in industries such as restaurants and travel, is already suffering a desperate cash crunch as bookings fall and the UK population cuts down its social activity. Accounting for around 9% of UK employment, leisure is a vital industry for UK jobs and prosperity and will be the first industry to be hard hit by the pandemic.
Peter Hemington, corporate finance partner at BDO said:
“While the measures announced in the budget to help businesses through the Covid19 emergency were welcome, they did not go nearly far enough. Very few businesses have cash reserves available to get through a likely two to three month shutdown, so the majority will struggle severely unless drastic action is taken”.
“The government has a tried and tested role as an insurer of last resort. It must adopt that role now by offering businesses impacted by the coming Coronavirus shutdown insurance against their reasonable losses incurred in the coming months.”
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