The Federation of Wholesale Distributors (FWD) has urged the government to immediately open up the £1.5 billion in business rates relief offered to food wholesalers nine months ago, or face potential supply chain failures.
According to federation, wholesalers have been relying on a busy Christmas period to start their recovery from the losses of 2020 and the early part of this year when their customers were closed.
However, with demand failing in hospitality venues and retailers as Covid-19 cases rise and more restrictions expected in the coming weeks, the promised Covid-19 Additional Relief Fund (CARF) set up by Rishi Sunak in the spring is “now desperately needed”.
Food wholesalers were specifically mentioned in the announcement on 25 March as an example of beneficiaries of the fund, but, the first time they have been given access to the business rates relief offered a year earlier to supermarkets and other parts of the food supply chain.
Now, nine months later, no guidance has been given to local authorities on how the fund should be allocated, the federation said.
“Our members have endured their customers being closed on three separate occasions, including at one day’s notice earlier this year,” FWD chief executive James Bielby said.
“They’ve struggled to recruit and retain staff as labour costs have increased, they’ve had to absorb stock shortages and rising energy bills, and they’ve seen their teams hit by illness, isolations and a hot labour market.
“With the new restrictions now in place, Christmas isn’t going to be the boost they desperately needed and the New Year could be very challenging indeed if demand is restricted again. The money that could keep some wholesalers’ doors open through the winter is available – but they can’t access it.
“We need the Department for Levelling Up, Housing and Communities to issue guidance to local authorities immediately, so they can set up allocation schemes early in the new year. Any further delay could have very severe consequences for a distribution sector which has worked miracles to keep its customers supplied so far.”
The Rating (Coronavirus) and Directors Disqualification (Dissolved Companies) Bill, which releases the £1.5 billion funding, has been passed by Parliament and is now awaiting royal assent.