Today, the ASSC held its first talk in 2021 and with over 330 attendees registered, it was looking to be a popular event.
It was a great opportunity to hear about all of the latest updates on funding support, the STL Legislation proposals and also hear from the inspiring Willie Cameron.
We received a lot of questions and as a summary of our discussions we have highlighted an overview of the topics discussed and links to more information if required.
We will have a link to the recording of the session and a response to questions raised in the next few days:
The ASSC are currently engaged in ongoing discussions with policymakers about self-caterer access to various funding support packages provided by the Scottish Government – this includes Discretionary Funding, the Strategic Framework Business Fund, as well as the recent bespoke funding measures announced by the Scottish Government in December 2020.
In recent days, we have spoken with MSPs in mainland and island regions, as well as Scottish Government Cabinet Secretaries and leading industry stakeholders. Progress is slower than we desired but don’t worry – we are working tirelessly to get answers and conversations remain ongoing.
Clarity on Financial Support:
We are liaising with the SG’s Tourism Directorate, STA and VisitScotland to press for clarity on all available funding mechanisms and specifics regarding the various financial support grants:
Strategic Framework Business Fund: Temporary Closure grant
Now that our businesses have been required to close by law, this fund becomes available to us. Your business must be registered for non-domestic rates to be eligible. Payments will be paid administered by local authorities, and you will not need to re-apply if restrictions are extended beyond four weeks. This grant represents £2,000 if your business premises has a rateable value of up to and including £51,000 or £3,000 if your business premises has a rateable value of £51,001 or above. You can apply for a grant for each property registered on NDR. There is no longer be an upper limit of £15,000 for any eligible business operating multiple premises.
ANNOUNCED YESTERDAY:
A significant top-up to the grant support available for hospitality, retail and leisure businesses across Scotland closed by level 4 restrictions will be paid following an announcement by Finance Secretary Kate Forbes.
In addition to the grants businesses receive through the Strategic Business Framework Fund, eligible businesses will also get a one off grant of:
- £25,000 for larger hospitality businesses on top of the 4-weekly £3,000
- £6,000 for smaller hospitality businesses on top of the 4-weekly £2,000
In most cases, eligible businesses that have already applied for the 4-weekly payment from the Strategic Framework Business Fund will get an automatic top-up.
For the majority, this top-up will be combined with the next tranche of payment for the Strategic Framework Business Fund due to go to businesses on 25 January.
Businesses that haven’t yet applied for either of these funds should submit an application as soon as possible through their local authority website. Applications are now open.
It has been confirmed that Businesses accommodating Key Workers will NOT be excluded from the Strategic Framework Funds.
Business Bank Accounts:
We have received a huge amount of representation regarding the requirement for a business bank account in order to be eligible for this grant.
There is no legal requirement for Sole traders and Partnerships to operate a business bank account, as everything is owned outright by the proprietor. Accountants may recommended that sole traders operate a separate bank account for their business operations as it helps ensure all income and costs are captured correctly when preparing accounts. On this basis, many small businesses have not historically held a business bank account (B&Bs and self-caterers amongst them). A business bank account was not required as part of the original Small Business Support Fund for self-caterers. We have been liaising with MSPs, the FSB, Chambers of Commerce and the STA to highlight this issue and urge the Scottish Government to provide clarity on how local authorities are / should be processing funding applications. We are now confident that the requirement for a business bank account is going to be withdrawn in favour of the production of a business insurance certificate. I suggested this to Kate Forbes on 23rd March 2023, so I am glad it is finally being introduced.
We were delighted that following a great deal of lobbying, Fergus Ewing announced that self-catering businesses were to be supported by a £7M Financial Support Package for Self-Catering announced before Christmas. This compares to £5 million for visitor attractions, £2.5 million for outdoor tourism, £2.3 million for hostels, £2 million for ski centres, £1.2 million for Destination Management Organisations and £1 million for B&Bs. We were able to secure the £7m based on the evidence that we have provided, via our survey results and sheer persistence.
We are still waiting for the detail of the funding package, but we believe that it has been designed to mitigate the very significant impact that the single household restriction has had on self-catering. Properties that accommodate more than one household have been effectively forced to close by the rule and many have been left without any reliable means of income or government support since 23rd September. The detail of that grant should be announced imminently. What we do know is that it is targeted at properties on NDR.
It is becoming more and more apparent that this lockdown is likely to go on for some time. We have little confidence that we will be able to welcome guests before spring. However, for properties that accommodate multiple households, the likelihood of being able to operate is highly unlikely for a considerable time to come. We are seeking further urgent financial support for operators which accommodate multiple households.
Finally, and in light of the new lockdown, we are trying to establish the possibility of any further funding from the UK Government. There is still a lack of clarity as to whether the £375m announced by the Chancellor last week will be an additional pot of money for Scotland, or whether it has already been given as part of a previous Barnett Consequential. Boris Johnson seems to have given an assurance to Ian Blackford that it will be available, but we are still seeking clarity.
Level 3 Funding:
On 7th December, Kate Forbes responded to a letter we wrote to her on 22nd October. In it she said that “Self-catering businesses, that are in Level 3, with reduced visitor numbers due to the travel / gatherings restrictions are currently not eligible for Business Restrictions Fund support.”
Accommodation providers in Level 3 are closed due to circumstance. We have been briefing both mainland and island MSPs and industry stakeholders to lobby for this to be rectified. We are now confident that financial support WILL be forthcoming.
For properties that are on NDR, we have been asking for the date that they were registered on NDR to be in November 2020, rather than March 2020, to allow for those businesses that have got themselves in order in the interim to be covered.
We understand that this is a really challenging, frustrating and anxious time and we will endeavour to get clarity from the Scottish Government on funding arrangements for self-caterers as soon as possible.
Business Rates:
We are now confident that there will be an extension to Business Rates Relief.
As you can see, targeted and successful lobbying has resulted in significant changes. So let’s see what else we can do!
Mortgage Holidays:
We are working with various stakeholders to see if some pressure can be put on the Financial Conduct Autority and Regulators to extend mortgage holidays beyond the original 6 months. With zero income, many self-catering properties will be unable to service mortgages on their business properties. Given that many have a mortgage that covers both their personal dwelling and business properties, if they default on their mortgage due to loss of income, they will potentially lose their home too. If banks could be amenable to extending mortgage holidays, it would be hugely appreciated by many, in the absence of further funding being available.
Conversations are very much ongoing and we will continue to do everything we can to support the recovery of the sector.
Meanwhile, whilst all of this is going on, the freight train that is Short-Term Let Licensing continues to pick up speed.
- Leading tourism and business stakeholders have highlighted the negative impacts of the proposed short-term let regulations for the economy and tourist industry, especially in light of the pandemic, and have recommended a postponement.
- The real cost to local councils of implementing the licensing and planning control areas has simply not been properly considered.
- This was made more difficult in the absence of a Business Regulatory Impact Assessment being published alongside the consultation.
The commercial reality is that guests will simply not book if their bookings are conditional and subject to a term between owner and guest that says the owner can cancel the booking if they cannot either obtain or renew a licence.
Kevin Stewart MSP, Minster for Local Government, Housing and Planning, outlined in a letter of 11 Dec 2020 letter to Willie Rennie MSP: “expects the position in respect of refunds for future bookings affected by refusal, suspension or revocation of a licence to be covered by booking terms and conditions in the same way as any other scenario in which the accommodation becomes unexpectedly unavailable, such as through fire damage or flood”. This shows a contemptible lack of understanding of commercial contracts in the tourism sector. This is equivalent to a supermarket saying to a customer: “you can put all your shopping in the basket, but we might decide we are not going to be able to sell it to you when you reach the check-out”. This may be perfectly achievable contractually if the customer agrees to it, but who would agree to it? People won’t book with an owner who says “I will take the booking, but I might not honour it, and I am telling you that now Mr and Mrs Guest, just so you know and it is incorporated in our agreement as a term”.
STL Legislation Impact on B&Bs:
It transpires that the ill-considered Short-Term Let legislation also impacts B&Bs:
Andrew Mott, Chair of the STL Delivery Group, has confirmed that “home sharing is defined in the Licensing Order (sch. 2, para 13) and includes bed and breakfast activity. B&Bs are not listed as excluded accommodation at schedule 1”.
We are of the understanding that the Delivery Group did not consult with the B&B sector which we believe would be a basic duty given the impact of the regulations.
We have shared this with the B&B Association, Scotland’s Best B&Bs, VisitScotland, DMOs, FSB, Scottish Land and Estates, and Cabinet Ministers, none of whom realised that B&Bs would fall within the scope of the regulations.
SG appear to be introducing this licensing principally because of concerns around Airbnbs in tenement flats (mostly in Edinburgh) and a proliferation of second homes in some very specific places like Elie. These are real issues, but they should be addressed by targeted, practical, fit for purpose, provisions that don’t have the unintended consequence of seriously damaging the Scottish tourist industry and disproportionately affecting small businesses and their supply chains. The only winners will be medium to large property owners who can live with the bureaucracy and uncertainties and benefit financially from the reduced competition as small business are forced to close.
SG have been told this repeatedly by many people but simply don’t appear to listen.
It is remarkable that something this significant and far reaching is being implemented by secondary legislation, which receives less parliamentary and media scrutiny.
No account has been taken of our survey results suggesting that 49% of professional operators will leave the self-catering market, as licensing will render businesses unviable
The ASSC has a number of concerns about the draft SSIs and will continue to make representations on your behalf to both the Scottish Government, the Short-Term Let Delivery Group as well as the parliamentary committees, and we will keep you updated with relevant developments.
Always wanting to end on a positive, what can we all do to assist recovery? When we come out of lockdown and restrictions are lifted, I have absolute confidence that self-catering will bounce back, as it did last summer. This will be the sector of choice for a good long time. So let’s use this time wisely to be ahead of the game when we can reopen.
THINGS TO DO IN LOCKDOWN
- Update your Terms and Conditions, making sure your Covid-19 cancellation terms are clear
- Update and refresh your photos and text on your websites (Google always likes ‘active’ sites)
- Check you have the rights to use all images on your website, if in doubt, remove and replace with one that you do
- Check your prices
- Display your prices for 2022 and 2023
- Walk through your properties with a note pad with an open eye, and make notes for repair or improvement
- And for goodness sake, if you aren’t on NDR, register now! If you are available for let for under 140 days you should be in the Council Tax system; if you available for let for over 140 days, and actually let for 70 days, you should be on NDR.
- And maybe even get a business bank account if you don’t have one already.
- Finally, think about accreditation:
Accreditation
We are providing Covid secure hospitality and we have to maintain standards to continue to pressure Government to let us trade more sustainably.
A very visible way of doing this is to use these schemes to display your Covid protocols.
Quality in Tourism’s Safe, Clean and Legal Scheme:
This is the Gold Standard for Covid accreditation and involves a fully trained assessor supporting offline and in person, helping you complete a risk assessment and deliver a best in practise standard, every property is checked. Recognised as the most robust scheme from Which? magazine, Safe, Clean & Legal evolved with the support of Environmental Health Officers; it covers the whole hospitality and tourism industry and will put both you and your clients mind at rest.
AA Covid Confident:
The AA COVID CONFIDENT scheme is FREE and open to all hospitality establishments that pass the AA’s stringent criteria, including: hotels; restaurants; pubs; B&Bs and guest accommodation; camping, glamping and holiday parks; self-catering accommodation; hostels; serviced apartments; attractions; and golf courses. The scheme is free to establishments.
Good to Go Standard:
The Good to Go standard initiative is a FREE self-certification scheme developed by VisitEngland in partnership with VisitScotland, VisitWales and Tourism Northern Ireland. It is directly linked to national and sector specific public health and safety guidelines and aims to give confidence to businesses, visitors and communities of high standards of compliance and hygiene in tourism establishments. It will operate through an online portal, backed up by process checks and supported by a call-centre facility to answer more detailed questions from businesses.
There’s a lot to think about. We remain committed to supporting you to keep self-catering businesses viable and our outlook positive in 2021.