Tier 4 rules ‘will hammer retailers’ during busiest trading period

Empty Regent Street

High streets were last night tipped into renewed crisis in the peak Christmas trading season when the prime minister put London, the southeast and east England under tougher restrictions and told non-essential retailers to close.

Boris Johnson yesterday reversed his decision to allow up to three families to meet for five days over Christmas — banning travel for anyone but key workers in London, the southeast and east as the areas were put into tier 4. Wales has gone back into full lockdown.

High street bosses warned that this would push more retailers to the brink by depriving them of takings in the vital last few days of trading. Doug McWilliams of the Centre for Economics and Business Research said that up to £7bn of spending would be delayed or lost. The British Retail Consortium said £2bn a week of sales would be lost.

The rest of the country, which will be in tiers 1 to 3, was told to “stay local”. Bubbles over Christmas are discouraged. Business leaders said that retail, hospitality and theatres desperately needed more support, as Brexit stockpiling put extra pressure on supply chains. Last month, Chancellor Rishi Sunak extended the furlough scheme by a month until the end of April.

Superdry chief executive Julian Dunkerton said: “I hope Sunak has deep pockets because the next two weeks are absolutely vital for retailers. If you’re going to take them away, then VAT for retail needs to be scrapped this month and the business rates holiday must be extended for at least another 12 months.”

Gary Grant, founder of toy shop The Entertainer, said he felt “punch drunk”.

“You plan for an entire year for this week. It will be a very, very busy weekend for us on the web, but we want children running around our shops.”

Johnson’s latest plan aims to halt the mixing of households as a new, more transmissible strain of the virus rips through the population. Ministers realised belatedly that an exodus from the capital by rail would coincide with shortages of train services, with many lines closing for engineering works. That could have led to overcrowded services and queues at stations.

As well as non-essential retail, tier 4 will hit gyms, which will have to close. Humphrey Cobbold, chief executive of PureGym, said he would have to close about 80 of his 230 gyms overnight. “I’ve got to tell 1,000 staff to go home and go back onto furlough,” he said.

The restrictions will also cripple air travel just as it was beginning to make a recovery. Flying will be discouraged, hammering airports and airlines, which have started introducing testing, with the quarantine period from high-risk countries cut from 14 days to 5.

Ewan Venters, Fortnum & Mason’s chief executive, warned that retailers could not survive another hit from Covid-19 restrictions. “A few weeks ago, I had a view that a third of retail brands would not be on the high street by the end of March — and I now think I have probably undershot with that number.”

Business leaders have complained about mixed messages. Days ago, Johnson said: “We don’t want to criminalise people’s long-made plans.”

Matthew Fell at the CBI called tier 4 a “kick in the teeth for many businesses already struggling badly”. Michael Kill of the Night Time Industries Association said there was “anger and disbelief” among operators of bars and clubs. Paul Drechsler, chairman of lobby group London First, said the latest measures would “add to the pain”. But he added: “The overriding interest in businesses across London is to do what is necessary now, to avoid a further lockdown in January … We don’t want to be checking in and out of Hotel California.”