Following Rishi Sunak’s announcement of the winter economy plan, including the job support scheme, Rajeev Shaunak, head of travel and tourism at MHA MacIntyre Hudson, said the chancellor had not done enough to help the sector.
“The measures announced today don’t rise to the challenge faced by the travel sector.
"The job support scheme may be too little too late.
"Many businesses have already planned further redundancies for the end of October, based on the planned end date for the current furlough scheme. It’s doubtful all the planned layoffs can be reversed.
“Although the government says the new job support scheme will help travel businesses that are viable, we still don’t know what this means in practice.
“Even assuming firms have time to review redundancy plans and find themselves considered viable, the cost to employers of paying at least 55% of the normal wages may be more than many travel businesses can afford.
“The travel industry continues to see much lower demand than expected. Until this changes the outbound market needs strong and sustained help and this has yet to be offered.
“While domestic and inbound tourism will benefit from the continued reduction in VAT, the confusing rules on quarantine have virtually destroyed the inbound market for 2020.”
He continued: “Without clear evidence that the virus is under control, both here and overseas, traveller confidence will not return.
"This is obviously some way off, so stronger measures are required to avoid further job losses in the immediate future.
“When the sector does eventually pick up a key factor is how much money the consumer has left in their pockets to spend on holidays. Everything suggests that any income tax increases have merely been deferred for now and not cancelled – the government will have to balance its books at some point in the future.”
