Co-op to return £15m of furlough support

The Co-op has said it will repay the government £15.5 million it received in furlough support during the height of the pandemic, but stopped short of handing back the £66m it secured in business rates relief.

It comes after more than £2 billion in rates relief was handed back by other essential retailers who continued to trade during lockdown measures.

The mutual made the announcement as it revealed its revenues increased by 5.5% to £11.5bn during the year to January 2.

Meanwhile, it revealed its profits after tax and discontinued items more than doubled to £77m despite being hit by £84m in pandemicrelated costs.

Co-op CEO Steve Murrells said he believed the move to hold on to the property tax relief was still “in line with our ethics”.

“It was a decision supported by the board and our membership council,” he said. “We are not a company who have paid out a dividend and we don’t have the access to capital markets as others, so that relief was vital.

“The furlough money was funding which we claimed for at the onset of the pandemic and because that was money we actively claimed for, we unanimously decided to return that.”

The UK’s five largest supermarkets have all repaid the rates relief, although rivals including M&S, Waitrose and Iceland have also held on to funds secured as part of the rates holiday.

The Co-op said it will not claim for extended rates support offered to firms for the new financial year.

Mr Murrells added that he expects 2021 to be “as challenging” as last year despite the continued rollout of coronavirus vaccines.