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SLTA News And Updates 12th May

SLTA News and Updates 12th May

Coronavirus job retention scheme continuing until the end of October. New study to examine policy options for reopening pubs restaurants and nightclubs. Open letter to the Association of British Insurers.


  • Furloughed workers across UK will continue to receive 80% of their current salary, up to £2,500.
  • New flexibility will be introduced from August to get employees back to work and boost economy
  • In a boost to millions of jobs and businesses, Rishi Sunak said the furlough scheme would be extended by a further four months with workers continuing to receive 80% of their current salary.
  • From the start of August, furloughed workers will be able to return to work part-time with employers being asked to pay a percentage towards the salaries of their furloughed staff.
  • The employer payments will substitute the contribution the government is currently making, ensuring that staff continue to receive 80% of their salary, up to £2,500 a month.

The Chancellor, Rishi Sunak said:-

“Our Coronavirus Job Retention Scheme has protected millions of jobs and businesses across the UK during the outbreak – and I’ve been clear that I want to avoid a cliff edge and get people back to work in a measured way.   This extension and the changes we are making to the scheme will give flexibility to businesses while protecting the livelihoods of the British people and our future economic prospects.

New statistics published today revealed the job retention scheme has protected 7.5 million workers and almost 1 million businesses. The scheme will continue in its current form until the end of July and the changes to allow more flexibility will come in from the start of August. More specific details and information around its implementation will be made available by the end of this month.

The government will explore ways through which furloughed workers who wish to do additional training or learn new skills are supported during this period. It will also continue to work closely with the Devolved Administrations to ensure the scheme supports people across the Union.  The Chancellor’s decision to extend the scheme, which will continue to apply across all regions and sectors in the UK economy, comes after the government outlined its plan for the next phase of its response to the coronavirus outbreak.

The scheme is just one part of the government’s world-leading economic response to coronavirus, including an unprecedented package for the self-employed, loans and guarantees that have so far provided billions of pounds in support, tax deferrals and grants for small businesses. 

Today the government is also publishing new statistics that show businesses have benefitted from over £14 billion in loans and guarantees to support their cashflow during the crisis. This includes 268,000 Bounce Back Loans worth £8.3 billion, 36,000 loans worth over £6 billion through the Coronavirus Business Interruption Loan Scheme, and £359 million through the Coronavirus Large Business Interruption Loan Scheme.”

On hearing the announcement, the SLTA’s Managing Director said:-

“The extension of the current Job Retention Scheme until the end of October will offer some relief for businesses and staff and reflects the calls from the Scottish Licensed Trade Association and others in the hospitality industry for ongoing support for our sector, which will undoubtedly be one of the last to open.  We will have to wait on the detail of this support until the end of the month, but there are already concerns on what employers will be asked to pay towards the salaries of their furloughed staff.

The furlough extension was part of the SLTA’s wish list to help businesses avoid the worst scenario of the hospitality industry “opening” to some extent, coupled with a cessation of current and potential ongoing support from Government and current social distancing rules remaining. The SLTA’s wish list is:-

Extend furlough and introduce a further developed, flexible, phased and part time scheme for the foreseeable future.

Extend Business Rates holiday until signs of business recovery.

Reduction in VAT for hospitality businesses as soon as possible.

Further extension of time for repayment of deferred VAT.

Development of a scheme to cover on-going businesses costs, when closed or partially open.

If we are allowed to open, but under such restrictions that it is not viable to open, and government support ceases, then we are in the same horrendously precarious position as our industry is in now.”   


A new University of Stirling study is seeking to understand how the easing of COVID-19 pandemic restrictions on licensed premises can be effectively managed to protect emergency services.

The project – funded under the Scottish Government’s Rapid Research in COVID-19 programme – will examine policy options for reopening pubs, nightclubs and restaurants to minimise the impact on ambulance services, and to protect customers and staff from the virus. 

The team will investigate how the re-opening of premises could be phased in over time, and whether and how licence holders could minimise infection risks. The study will consider the way in which consumers and venues might respond to any easing of restrictions – in terms of alcohol consumption, intoxication, violence, sales and promotions.

The impact of current restrictions on ambulance service callouts will also be examined, as well as the potential impact should establishments reopen.

Professor Niamh Fitzgerald, of the Institute for Social Marketing and Health (ISMH) at Stirling, is leading the new project, which also involves Martine Stead, Deputy Director of ISMH, and Professor Jim Lewsey, of the Institute of Health and Wellbeing, University of Glasgow.

Professor Fitzgerald, an expert in alcohol policy, said:

Most pubs and nightclubs closed more than seven weeks ago, as part of the UK and Scottish Government response to the COVID-19 pandemic.

Governments and the public are very interested in how licensed premises may begin to reopen – but there are risks involved. Whenever restrictions ease, businesses may seek to recoup losses and customers may choose to celebrate by drinking more than usual.

The actions of businesses and consumers could have implications for how intoxicated people get, and have a knock-on impact on our emergency services. It is really important therefore, to understand the options available for easing restrictions.

We will consult with a wide range of businesses, staff, policymakers and experts. One option could be to ease restrictions partially, or in a staggered way, potentially with measures remaining in place around sales, opening hours or venue capacities to minimise harm and impact on the emergency services.”

Professor Fitzgerald added: 

“Our aim is to feed information quickly and directly into policy and guidance – both at Scottish Government and local level – regarding the easing of COVID-19 restrictions on licensed premises.”

The new study is set to complete within six months.

The SLTA received a positive response to its offer to participate in any appropriate way with this research.


The SLTA has supported an open letter and petition to Huw Evans, Director General of the Association of British Insurers, over the insurance industry’s response to the Covid-19 pandemic.

The letter and petition states:-

“The UK insurance industry is failing small and medium businesses (SMEs) at their moment of greatest need. Denying claims for business interruption due to COVID-19 will directly result in the collapse of thousands of companies that might otherwise have survived this crisis. Thousands more jobs will be needlessly lost and the burden on the British taxpayer will increase.

The Association of British Insurers (ABI) and its member firms have shown that flexibility can be your response to this pandemic. You have announced extra support for motor, household and travel insurance policyholders. This commendable approach has helped to mobilise community volunteers, reassured millions working from home, and handed an emergency healthcare lifeline to those stuck abroad. Unfortunately, you have determined to take a harsh and intransigent approach with the SMEs that form the backbone of our economy.

The ABI’s abrogation of responsibility has come as a considerable shock to SMEs that paid extra for extended business interruption (BI) cover. In the early stages of the COVID-19 crisis, well before the current lockdown, thousands of business owners like us examined our insurance documents. We were relieved to see that we should be covered. Our seemingly prudent decision to pay higher premiums gave us hope that we could avoid redundancies, pay our bills, and plan for our eventual recovery.

We understood that claims would depend on certain criteria being met. Most policies did not specifically rule in or out a pandemic, but terms typically included a formal instruction to close business premises by an authorised public body, COVID-19 being listed as an officially Notifiable Disease, or the declaration of a Public Authority Incident. The Government listed COVID-19 as a Notifiable Disease on 5 March. On 23 March it ordered most businesses premises to close. A speech by the Chancellor on 17 March made clear that firms with insurance for pandemics would be able to make a claim. On 19 March, the Financial Conduct Authority (FCA) told insurers to treat customers fairly and consider payments on claims they might usually reject. The actions taken by the Government reassured us that policy criteria were being fulfilled. The announcement by the FCA gave us confidence that the response of insurers would be accommodating.

As these events unfolded, your industry closed ranks. On 18 March, the ABI released a statement that narrowed its stance on BI cover. On 27 March, in a formal response to the Rt Hon Mel Stride MP, Chair of the Treasury Select Committee, you noted that only a minority of businesses held appropriate cover and highlighted comments by Sir Charles Bean, an economist, that “the state is always the insurer of last resort”. On 30 March, you published an article that implied the volume of claims would be unaffordable for your members, contradicting earlier ABI announcements that few businesses held relevant cover. Meanwhile, your members released pre-emptive statements discouraging customers from making BI claims related to COVID-19.

The position of the ABI and its members is callous and wrong. Failure to recognise COVID-19 as a Notifiable Disease is negligent. Denying that it is a Public Authority Incident is preposterous. Your members have demonstrated through their actions with other customers that reason and flexibility can prevail. Why not with SMEs?

There is no suggestion that insurers should make pay outs to businesses with only basic BI cover. However, those of us that paid for extended BI policies are justified in expecting providers to honour them. It is hard to understand why this would not be affordable for your industry: BI payments are capped, and by your own admission they will be few in number.

You have stated that insurers are willing to work with government and do more to protect the world from future pandemic risks. Partnerships between the industry and government have enabled policies to be written for events with widespread impact, including flooding, terrorism and earthquakes. Taking a similar approach with future pandemics is sensible and to be welcomed; it does nothing to remedy the present situation. British insurers need to show good faith by changing their approach to extended BI cover now.

Since the ABI and its members seem determined to resist, SMEs are now hoping that the FCA will obtain a court declaration to bring much needed clarity and certainty. We trust its action will encompass all extended BI policyholders, eliminate injustices such as insurers determining whether to recognise Notifiable Diseases or Public Incidents at their convenience, and lay the path for swift processing of claims and pay outs.

We also hope that the ABI may yet pre-empt the judgement of the court, make a resolution to honour extended BI claims, and so restore the integrity and reputation of your industry. This would be a more positive outcome for SMEs and your members. It would ensure the survival of many threatened businesses, reduce avoidable damage to our economy, and prove to buyers of business insurance products that the ABI and its members can be trusted to stand by policyholders.”

This action follows the Financial Conduct Authority’s recent announced that it intends to obtain a court declaration to resolve contractual uncertainty in business interruption (BI) insurance cover. This is due to continuing and widespread concerns about the lack of clarity and certainty for some customers making business interruption claims, and the basis on which some firms are making decisions in relation to claims.

The FCA intends to take this action in the public interest to advance their consumer protection and market integrity objectives. The organisation believes the circumstances of the current Covid-19 emergency, and its effect on businesses holding BI policies means that any uncertainty needs to be resolved as quickly as possible.

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