Businesses across the north and north-east have welcomed calls for leftover Covid cash to be used to help ease the energy crisis.
Audit Scotland this week published a report looking at the Scottish Government’s financial response to the pandemic since March 2020, acknowledging that while ministers managed the overall Covid-19 budget “effectively”, some funding still remains unspent.
Some £15.5 billion was allocated for Scotland’s Covid-19 response between 2020 and 2022, of which an estimated £11.8 billion was spent between March 2020 and December 2021.
The Federation of Small Businesses has suggested any money leftover should go towards helping firms deal with soaring energy costs.
Earlier this week, SportAberdeen announced it was “temporarily” closing its pool at the Beach Leisure Centre in August due to spiraling bills.
Businesses facing 85% increase
SportAberdeen was unable to comment on the FSB’s idea, but other organisations across the region broadly welcomed it.
JGC Engineering and Technical Services in Thurso currently employs a workforce of 120 and is a high energy user due to the nature of the business.
Company director Will Campbell said that the change in price is “astronomical” and has resulted in a six-figure increase, with costs rising by about 85%.
Describing it as a “major, major issue”, he said there should “absolutely” be more support for businesses at this time, but finds it hard to comprehend how prices have risen so much.
Mr Campbell added: “I know the price of wholesale gas is going up, but how come the price of energy has? We’ve got all these wind turbines around us here in the north of Scotland, so how’s the energy and electric prices gone up so much in comparison?”
Meanwhile the hospitality industry is also struggling with rising costs and a drop in customers, while also still recovering from the pandemic.
Louise Maclean is business development director at Signature Group – which has 24 venues in Scotland, including Paramount Bar, Nox Nightclub and the Spiritualist Bar in Aberdeen, and employs more than 600 people.
‘Eye-watering’ rise in costs
Ms McQueen said they are dedicated to supporting both their staff and customers, however, this proves to be a greater challenge amid the “eye-watering” rise in costs.
“We are very fortunate to have such student-friendly venues and we rely a lot on our student customers”, she said.
“But with drinks up 14% due to inflation and energy bills rocketing, it’s probably becoming increasingly difficult for them to put cash aside for a night-out.
“These increases are eye-watering, and we see it from our side as well. Prices are going up on everything – drinks, supplies, electricity – everything we need to keep us going.
“We are now literally having to chase every sale and every customer to try and make our business efficient and ride the storm – as at the moment we are not making any more profit than we were in 2019, we are standing still.
“And if there are any funds left, they should go to those who need it most, whether that would be students or elderly people. I think we have a moral obligation to do that.”
Leaders need to be clearer
The report, Scotland’s financial response to Covid-19, acknowledges that the Scottish Government moved at pace with its partners to respond financially to the pandemic.
However, Audit Scotland warn that public sector leaders need to be clearer about how one-off Covid-19 funding is being spent and what impact it has had.
A FSB spokesman said: “If there is leftover Covid related funding, then we can’t think of a better way of using that funding than helping businesses wrestling with increased costs at the moment.
“Some operators are saying the business conditions are tougher now than it was then.
“How we do that is up for debate and I think we would be prepared to work with experts in their field to try and develop a scheme that works for businesses and other operators, which are important to the local communities and the local economy.
“We we would hope that policymakers in London and in Edinburgh would understand just how difficult it is out there for Scotland’s business community.”
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