The government has introduced temporary measures in a bid to safeguard the UK’s high street against aggressive debt recovery actions during the Coronavirus pandemic.
With the vast majority of shops up and down the country forced into lockdown, retailers’ income has taken a significant hit. The longer retailers are made to close, the more difficult it’s going to be for them to pay rent. Many are already feeling the strain and it’s feared this will impact jobs and the long-term survival of these businesses.
While the majority of landlords and tenants are doing everything they can to reach an agreement, some landlords have been putting tenants under pressure by using aggressive tactics. The government’s intervention will see a ban on statutory demands made between 1 March 2020 and 30 June 2020.
Instead, retailers will be asked to pay what they can to help ensure they don’t fall into deeper financial strain.
The Government is also working on secondary legislation to provide tenants with more breathing space by preventing landlords using Commercial Rent Arrears Recovery (CRAR) (unless they’re owed 90 days of unpaid rent).
Speaking about the situation, business secretary, Alok Sharma, commented:
“In this exceptional time for the UK, it’s vital that we ensure businesses are kept afloat so that they can continue to provide the jobs our economy needs beyond the coronavirus pandemic.”
He continued:
“I know that like all businesses, they are under pressure, but I would urge them to show forbearance to their tenants. I am also taking steps to ensure the minority of landlords using aggressive tactics to collect their rents can no longer do so while the COVID-19 emergency continues.”
To find out more, head to the gov.uk website. Alternatively, please don’t hesitate to get in touch with PKB Accountants and we’ll be more than happy to help.
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