// Gov’t extends current rent moratorium on commercial properties to protect tenants from eviction to March next year
// The moratorium bans landlords from taking tenants to court over unpaid commercial rent
// It was initially meant to lift at the end of June
The government is extending the current rent moratorium on commercial properties, which includes retailers, to protect tenants from eviction to March next year.
Treasury chief secretary Steve Barclay told MPs in the House of Commons yesterday that the current ban on evictions for unpaid commercial rent would be extended past the end of this month following the delay to easing further Covid-19 restrictions.
The ban, which stops landlords from taking tenants with rent arrears to court, was due to end on June 30 but will now be extended to March 25, 2022.
- CBI urges gov’t to extend rent moratorium for struggling retailers
- 2/3 of retailers face legal action in July over £2.9bn in unpaid rents
- UK retail rent collection fails to improve, new research shows
Barclay also announced the government would introduce legislation for a new arbitration system to solve disputes between landlords and commercial tenants affected by the Covid-19 pandemic.
Giving an economy update in the Commons, Barclay said: “In recognition of the importance of jobs in the many affected businesses at the heart of local communities, we launched a call for evidence in April on further actions to take to resolve those debts.
“As a result of that call for evidence, the government now plans to introduce legislation to support the orderly resolution of these debts that have resulted from Covid-19 business closures.
“We will introduce legislation in this parliamentary session to establish a backstop so that where commercial negotiations between tenants and landlords are not successful, tenants and landlords go into binding arbitration.
“Until that legislation is on the statute book existing measures will remain in place, including extending the current moratorium to protect commercial tenants from eviction to March 25, 2022.”
Barclay added: “To be clear, all tenants should start to pay rent again in accordance with the terms of their lease, or as otherwise agreed with their landlord, as soon as restrictions are removed on their sector if they are not already doing so.
“We believe this strikes the right balance between protecting landlords and supporting those business that are most in need.”
BRC chief executive Helen Dickinson welcomed the announcement for retailers.
“This is a very welcome announcement, addressing an issue of vital importance in the nick of time,” she said.
“We will be looking closely at the details, but welcome the continued support provided by government to businesses.
“Just as retailers feared a wave of legal action by landlords, the government has stepped in to offer both landlords and tenants more time to negotiate.
“The last 15 months have seen extended periods of forced closure for retailers, preventing many from making the turnover needed to cover rents.
“Retailers need time to trade their way out of debt; this announcement does exactly that. We’re also pleased to see the government adopt our proposal for binding arbitration where agreements between parties cannot be reached.”
Shadow chancellor Rachel Reeves also welcomed the announcement, but said it was it still not enough to support struggling businesses.
“The truth is if the Chancellor believed that this economic package was enough, he would be here announcing it himself because whatever this is, it is not doing whatever it takes to support British businesses and our economy,” she said.
Thousands of high street businesses – mainly hospitality and leisure firms – have seen trading constrained by virus curbs.
On Monday, Prime Minister Boris Johnson said plans to remove remaining pandemic restrictions on June 21 have been pushed back to July 19 amid concerns over the spread of the Delta variant, which was first identified in India.
The Government is not expected to alter planned changes to the furlough scheme following the delay.
Currently, the state will cover 80 per cent of wages until the end of this month, with this tapering to a 70 per cent subsidy next month with at least 10 per cent covered by employers, and reducing until it is removed at the end of September.
with PA Wires