Third of firms fear they’ll never reopen
Economic damage will intensify, Swinney warns MSPs
Scotland’S economy is in freefall, with one in three firms saying they may never reopen.
Total economic output is expected to have shrunk by around 33 per cent since lockdown measures were introduced, according to Deputy First Minister John Swinney.
He said the economic turmoil is causing deep uncertainty and hardship, and the damage will ‘intensify’ as lockdown continues. Even as we take ‘baby steps’ out of lockdown, physical distancing may remain a part of life ‘for some time’.
A survey published yesterday by the Federation of Small Businesses (FSB) also found that more than a third of Scots who have put their firms into hibernation now fear they may never reopen.
In a statement at Holyrood yesterday, Mr Swinney said: ‘The lockdown has had an enormous impact on our economy, with a potential fall of 33 per cent of GDP.
‘This is unprecedented and is causing deep uncertainty and hardship for many businesses, individuals and households. The damaging effect on poverty and inequality may be profound and the impacts will intensify the longer the lockdown continues.’
He added: ‘We must do everything possible to avoid permanent structural damage to our economy.’
Mr Swinney was speaking yesterday in a debate about the next steps for suppressing Covid-19 in Scotland.
It followed a Scottish Government
document published last week that set out how the country could be in lockdown until next year, with rules repeatedly lifted and reinstated at short notice.
He told MSPs: ‘Physical distancing and limiting our contact with others may well be a fact of life for some time.’
Ministers will consider ‘further minor changes’ in the coming days, including allowing garden centres to reopen and some outdoor work, and they would look ‘urgently’ with councils at the possibility of opening recycling centres.
On schools, he said: ‘We will need to build the confidence of staff, pupils, parents and carers so that children and teachers feel safe and secure when they return.’
He said any decision on reopening schools would draw on the experience of countries that are further ahead in their pandemic curves.
Guidance on businesses will be published ‘sector by sector’ in the coming days and weeks.
The FSB findings sparked renewed calls for clear official guidance on the steps firms should take before reopening.
The survey found 53 per cent of small Scottish firms have had to close since the outbreak, compared with 41 per cent across the UK.
Of those that have closed, 35 per cent are not sure whether they will reopen again.
According to the survey, 19 per cent of Scottish businesses have failed to make rent or mortgage repayments, or faced severe difficulties in making them, while 71 per cent of Scottish small employers have furloughed staff.