Lord Gadhia: ‘Community backing vital to revive British economy’

by LAUREN CODLING

A CONSERVATIVE PEER has urged communities to support local Asian businesses as many struggle to stay afloat during the Covid-19 pandemic.

Lockdown measures implemented last month by the government have seen many business owners struggle to stay financially stable, although loans, tax relief and cash grants have been made available to those in need.

Lord Jitesh Gadhia said people should be encouraged to support local stores, curry houses and restaurants.

“Certain types of essential retailers are still permitted to operate in food-related or convenience businesses, so I think this is a situation where we have to encourage people to support their local stores for essential needs,” he told Eastern Eye on Tuesday (21).

The investment banker added: “Clearly, we should create some initiatives to simulate some support.”

Lord Gadhia’s comments come after the release of a discussion paper, co-authored by him and Sir Jonathan Symonds CBE, in which they outline a “graduated, phased and risk-based approach” to a reopening strategy for the UK.

They noted that the UK should aim to “avoid a stop-start economy which would sap public morale and damage business confidence yet further”.

Instead, developing a limited re-opening strategy was “essential” and authorities must plan for “living with Covid-19” for the next 12-18 months, the authors said.

They suggested that the initial focus for reopening the economy should be on sectors that “have the greatest multiplier effects with minimum risks”.  These include coffee shops and restaurants that support agriculture, according to the strategy paper.

Lord Gadhia and Sir Jonathan also recommended the release of the younger generation back into the economy and re-opening schools to release key workers as a priority.

On relaxing lockdown measures, Lord Gadhia said government guidelines and key messages have “entered the national psyche to such an extent” that officials will need to work on “carefully, reversing behaviours”.

“Otherwise, I think people will be afraid to re-circulate and reenter society in the normal way,” he said. “There will need to be some confidence building measures that accompany it.”

Therefore, the peer has suggested protocols be implemented in shops and offices to ensure they are not overcrowded and physical distancing is maintained, as well as providing personal protective equipment for those required to go outside.

Lord Gadhia said that risks must be taken into account while lockdown-lifting measures are discussed. For instance, health risks and social distancing should still be considered when shops and businesses reopen.

Keeping this in mind, he predicted larger stores reopening first as customers could better maintain a physical distance. He also suggested that some retailers could be required to install protective equipment, such as perplex screens at payment counters. This has been implemented by some major supermarkets.

“It’s this risk-based approach where business models can be adapted and where you can maintain safety where there might be some lifting of restrictions,” Lord Gadhia said.

On funding for businesses, he admitted that administering some financial support schemes has “been a challenge”. The Coronavirus Business Interruption Loan Scheme (CBILS), for instance, supports small and medium sized businesses, with an annual turnover of up to £45 million, to access loans, overdrafts, invoice finance and asset finance of up to £5 million for up to six years.

However, Lord Gadhia noted that banks needed to work on speeding up the process of applications as many businesses had experienced long waits for confirmation of the CBILS loans.

“There has been some progress in the last week as the chancellor announced recently – with a doubling in the number of loans processed – but obviously there is still a big gap between the number of businesses asking for funding and those who are receiving it.”

Predicting the worst-hit sector in an imminent recession, Lord Gadhia believes the hospitality, tourism and leisure sectors will feel the hardest impact.

In the strategy paper he coauthored, Lord Gadhia said restrictions on international travel and/or stricter health monitoring and quarantine procedures at UK borders may be required. “I think it is clear that unfortunately, those sectors are the ones which would probably take the longest to reopen and recover,” he said. “These sectors are already quite hard-hit and if you look at the performance of those companies it already anticipates that they will take a long time to come out.”