Leicester’s business community remains in the dark over what extra Government support it will get, more than a week after the city went into local lockdown.
Business leaders have warned hundreds of companies could go under if extra cash does not come soon.
Pressure is growing on the Government to provide extra help for non-essential retail businesses that were forced to shut - as well as pubs, restaurants and hairdressers forced to stay closed when others around the country re-opened on Saturday.
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Lockdown will remain in place until at least July 18 but could be extended for a further two weeks if localised levels of coronavirus infection in the city don’t come down.
Leicester mayor Sir Peter Soulsby said health secretary Matt Hancock indicated to him on Friday further money would be coming in to support firms, but that no further details had been unveiled.
Sir Peter said: “There was a clear indication that there would be something but since then we have heard nothing.
“I suspect it has been bounced back to the treasury.
“Businesses needed assurances days ago, not this silence.”
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It is possible there could be an announcement in Chancellor Rishi Sunak’s summer ‘mini-budget’ today.
Associate Professor Will Rossiter, an economist at Nottingham Business School, said pubs, bars and hairdressers that had planned to reopen would be badly hit.
He said: “The local lockdown in Leicester is likely to bear heavily on businesses that incurred significant costs in preparation for the anticipated opening of additional sectors on July 4.
“The flexibility to return workers affected by the lockdown to furlough is welcome, but additional financial support is likely to be required if this circumstance is not to result in additional business failures.
“There is the risk that Leicester-based businesses unable to trade will lose business to competitors based outside the lockdown.
“There is also a risk that some firms that would have opened on July 4 will not now reopen at all – because they will simply not be able to survive a further period without the ability to trade and generate income.
“As the first example of a local lockdown, the Leicester case is strongly suggestive of need for Government to consider a more spatially targeted approach to business and employment support initiatives as we move into high summer.
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“Particularly if, as some suggest, it is possible that more local lockdowns may follow Leicester should more local outbreaks of Covid-19 be identified.”
Leicester South MP Jon Ashworth has written to Mr Sunak urging action.
He said: “The Government promised extra assistance for Leicester following the announcement of a local lockdown on June 30.
Over a week has passed and local businesses still do not know what extra help they will be entitled to.”
“This extra support is needed by all businesses, but especially the food and drink sector, evening and night-time businesses and hair salons.
“These businesses, that were due to open on July 4 and now cannot open until at least 18 July, are on the brink of insolvency.
“This is as well as all the non-essential shops that had just opened and then had to close again.”
BID Leicester has stressed the need for additional direct grant funding to be provided to the business affected by the city lockdown as soon as possible.
“It has suggested that these funds be taken from the approximate £1.8 billion of the national business support grants fund that remains unspent.
BID Leicester director, Simon Jenner said: “The Business Improvement District in Leicester represents almost 700 businesses and we need their voices to be heard.
“Extending restrictions in Leicester means the city’s businesses now face exceptional hardship, which we believe should be met with exceptional support from the Government.”
Mr Ashworth’s letter to the Chancellor, was also sent to the secretary of state for business, energy and industrial strategy.
The MP said: “The Government needs to act now, not at the end of the month or later.
“If not, businesses in Leicester and especially in the city centre could shut up shop for good.”
A treasury spokesperson said: “We have extended the Coronavirus Job Retention Scheme until October – meaning it will have been open for eight months and will continue to support businesses.
“Businesses who have already furloughed staff can carry on doing so during this period, and our wide-ranging package of support is still open, including billions paid in loans and grants, mortgage holidays and more than £6.5 billion injected into the welfare safety net."