Published
Feb 3, 2021
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​Strong recovery possible for West End says Mayor's report, but more support needed

Published
Feb 3, 2021

Although Central London has been “profoundly” impacted by Covid, the capital’s Mayor Sadiq Khan has said a “rapid recovery is possible” in his report on future challenges and opportunities.


Photo: Nigel Taylor


But the Mayor called for the government to increase its support for severely hit businesses in the capital and called for “the biggest tourism campaign the country has ever seen, with a particular focus on the capital… Given the huge contribution of tourism to London’s economy”. It noted tourism spend declined by £10.9bn in 2020 compared with the previous year.

The report says that while London’s Central Activities Zone (CAZ) has been hit hard by the pandemic and is facing a bigger challenge than many other major cities including New York and Paris from continued home working and lack of tourism, the central London ecosystem “is well placed to recovery strongly with the right policies in place”.

But in the meantime, the Mayor has called on the government to improve and extend support for businesses in retail, hospitality, leisure and culture, calling on ministers to urgently extend the business rates holiday beyond March and the furlough scheme beyond April. 

“Without the certainty that support will remain in place for as long as it is needed, many more business owners could decide to cut their losses and close permanently”, the report stressed. 

It added: “Although people returning to the CAZ once the pandemic is over will give retail, hospitality and culture sectors a much needed boost, there’s a risk that many venues will have closed permanently before then”.

On tourism, City Hall analysis of forecasts by VisitBritain showed that consumer spending in central London by overseas tourists was £7.4 billion lower throughout 2020. Meanwhile, domestic tourists will have spent £3.5 billion less, and commuters £1.9 billion less than in the previous year.

Also, it noted that the capital’s economy accounts for a quarter of the UK’s total economic output and before the pandemic contributed a net £38.7 billion to the Treasury.

It also highlighted that London department store Selfridges paid more business rates in 2019-20 than 19 shire districts collected individually. Before the Covid-19 pandemic, London was due to generate more than £10 billion in gross business rates – a third of the national total. 

The Mayor is urging ministers not to take for granted the future growth of London. This includes calling for a series of urgently needed reforms to the business rates system to support the capital’s long-term economic recovery, including devolving power and accountability for raising the taxes needed to provide local services”.

Mayor Khan, said: “Central London’s mix of shops, restaurants, nightlife, museums and galleries is one of the city’s unique selling points, and attracts millions of tourists every year. But Covid has had a devastating impact on central London’s economy, with retail, hospitality, culture and night time industries bearing the brunt.

“When London thrives, the whole country thrives, so supporting our city’s businesses to survive the coming months will be absolutely vital. This must include the continuation of the furlough scheme, the business rates holiday, and the hospitality VAT reduction. With the right support from the Government, more businesses will survive and contribute to what this report shows could be a rapid recovery, once tourists and commuters return in numbers.

Jace Tyrrell, chief executive at New West End Company, added: “The pandemic has, so far, wiped out a year of trading for our businesses in London’s West End, and while we push to work toward a sustainable recovery, we are not blind to policies that will hold our businesses back. 

“We fully support the Mayor in his calls to urge Government to continue the business rates freeze beyond April 2021, with the hope that this will lead to eventual reform of this antiquated tax system that is causing viable businesses across central London to suffer”.

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