The retail trade in Britain will face a “tsunami of closure” if the government does not extend the current moratorium on the collection of debts. This is the prognosis of the British Retail Consortium (BRC), which represents the interests of the industry.
Every seventh store in the country is already empty: retail outlets that did not sell “vital” goods were forced to close during the pandemic. Total rental debts are as high as £2.9 billion, the BRC estimates.
Two-thirds of retailers say they are going to be charged with rent arrears through the courts after July 1, the day the moratorium ends.
Eighty percent of tenants say they have been given less than a year to pay off their debts. Ending the moratorium could lead to the closure of thousands of stores, the BRC says, urging the British government to extend the moratorium until the end of the year.
A temporary ban on the collection of rent debts in the commercial sector was introduced in the country in April 2020 and later extended several times. The government banned landlords from resorting to “aggressive” methods to collect debts.
Against the backdrop of the coronavirus pandemic and the introduction of lockdowns, the entire global economy faced a crisis. Even after the restrictions were lifted, businesses continued to face the effects of the crisis, including labor shortages and continued uncertainty.