Business leaders have reacted with despair to the fresh lockdown announced by Boris Johnson amid fears that companies may not last until the spring.
Unions called on the Government to offer more help to avoid further job losses.
British Chambers of Commerce director general Adam Marshall said: “Businesses will understand why the Prime Minister has felt compelled to act on the spiralling threat to public health, but they will be baffled and disappointed by the fact that he did not announce additional support for affected businesses alongside these new restrictions.
“The lockdowns announced in England and Scotland today are a body blow to our business communities, hard on the heels of lost trade during the festive season and uncertainty linked to the end of the Brexit transition period.
“Tens of thousands of firms are already in a precarious position, and now face a period of further hardship and difficulty.
“Billions have already been spent helping good firms to survive this unprecedented crisis and to save jobs. These businesses must not be allowed to fail now, when the vaccine rollout provides light at the end of this long tunnel.”
Jasmine Whitbread, chief executive of London First, said: “Businesses across the country will be wondering how they are going to survive into the spring. The Government must now extend business rates and VAT relief throughout 2021 and stand ready to pump further direct support to businesses forced to close.”
TUC general secretary Frances O’Grady said: “The Government’s financial support package isn’t good enough to cope with this renewed public health emergency. Without more support, jobs will be lost and businesses will close.
“Ministers must act quickly by providing targeted help for hard-hit industries, boosting sick pay to a real Living Wage so that people can afford to self-isolate and increasing Universal Credit.
“And in the wake of school closures, ministers need to help working families by encouraging employers to furlough parents who can’t work because of childcare responsibilities.”
Roger Barker, director of policy at the Institute of Directors, said: “The resurgence of the virus is aggravating the pain for businesses.
“For companies in sectors like tourism and hospitality, the vaccine-led recovery still seems a long way off. Even for organisations that can operate remotely, the closure of schools and nurseries could cause significant staffing headaches.
“The Treasury must now bolster support for the worst affected sectors. In particular, it should seek to reinforce the discretionary grant scheme allocated through local authorities, which has helped to reach those who have fallen through the gaps.
“It will also be crucial to smooth the cliff-edge in support that’s fast approaching in the spring.”
Unison general secretary Dave Prentis said: “The new restrictions are tough, but the virus has to be beaten. Otherwise, the NHS could be overwhelmed, with terrible consequences for those needing care.
“While most of us will now be safe at home, key staff in hospitals, schools, care homes and other essential services will keep doing their jobs, despite the risks. Many are exhausted, covering for colleagues off sick with Covid.
“Without a doubt, the Government should have acted sooner.”
Stephen Phipson, chief executive of Make UK, said: “In the face of a renewed national crisis the Prime Minister is right to take these vital measures.
“This fight is likely to occupy much of the coming year and, just as it has done since the start of the crisis, industry has supported the national effort and will continue to do so. In return, it is now critical Government revisits the business support packages.”
Emma McClarkin, chief executive of the British Beer & Pub Association, said: “A third lockdown is yet another blow to our sector. Particularly after it has faced an abysmally quiet Christmas and New Year’s, which saw many pubs remain closed over what is meant to be their busiest time of the year.
“The announcement today adds to the woes of pubs as it shows they are a long way from reopening properly. The road to recovery for the pub sector just got longer.
“Given the circumstances, a wave of business failures is imminent unless a greater package of financial support from the Government is given to secure pubs and the brewers that supply them.
“That means grants in line with those in the first lockdown and support beyond April when the business rates holiday, lower VAT rates and furlough scheme all end.”