Commercial Rent (Coronavirus) Bill

Debate between Toby Perkins and Sarah Olney

2nd reading
Wednesday 24th November 2021 Commons Chamber

[Sarah Olney (Richmond Park) (LD)]

The Liberal Democrats welcome the Bill and we hope it will be passed swiftly in order to protect struggling businesses. I have spoken to many businesses in my community that have really struggled with rent bills over the past 20 months. This is been a significant issue for many. As the Minister said, many landlords and tenants have been able to come to terms and make arrangements for how rent payments will be made, but a number have not been able to do so. I am thinking in particular of Don Fernando’s restaurant in Richmond High Street, a legendary Spanish restaurant right by the railway station that has been there 30 years. It was unable to make such an arrangement and it is still getting rent demands from its landlord, which is registered in Jersey, unfortunately. This is a significant issue for the restaurant. Only the stay of execution allowed by the moratorium on evictions has enabled it to carry on trading. It is still open and I was there a few weeks ago. It is doing well, but it has significant concerns about its rent debts, so on its behalf I very much welcome the steps that the Business Department is taking.

Of course, this affects not only tenants. I have spoken to landlords as well, including small landlords and landlords of single units. In some cases, where they are letting those units out to large multiples, some of those retail chains are just turning round to those landlords and saying, “We are not paying.” Up to now, there has been no mechanism to enter into a negotiation on this. It is very much the weaker party in these transactions that has to suffer the consequences, and on that basis I am really glad that this arbitration mechanism is being brought in. It will give a voice to both sides, particularly where there are no other mechanisms to resolve the issue.

My only slight grumble is that we could perhaps have passed this Bill sooner. The moratorium has been extended several times, which has been welcome, but bringing this Bill to Parliament more promptly would perhaps have allayed some fears and got the process going sooner for certain tenant-landlord relationships. But better late than never, as they say. It is here now and we certainly plan to support it. I hope that we will use this opportunity, even though we want to pass the Bill swiftly, to scrutinise it a bit further. One of the important points we want to raise is how arbitrators can effectively assess whether a business would have been viable. That is an important point, and we need to see more discussion about it. In the context of the pandemic, many businesses had to close because of Government instructions, but consumer behaviour has also changed radically as a result of the pandemic. As we look back over the past 20 months, I do not know how easy it will be to say which businesses would have been viable if their rent arrears had not built up to such an extent.

There are lots of great businesses in my constituency that came through the pandemic because they changed their way of working, including developing their online offering and doing home deliveries. We see right across our business sector, particularly in our small businesses, that entrepreneurs will always respond to challenges. Many businesses now look quite different from how they looked before, which is an example of how it is difficult to say what would or would not have been viable. Many business owners or their family members have suffered coronavirus infections, and they suffered untold disruption in their personal life that will have affected their ability to run their businesses. Again, how can we judge what would have been viable? How would things have been different? That is a difficult question to answer.

I welcome this further support to help businesses through what we might call the after-effects of lockdown.

[Mr Perkins]

The hon. Lady raises an important point. From what the Minister said, it sounds like a business will be eligible if the amount it owes in rent is the difference between going bust or not. Many businesses might have major rent payments that take them right to the brink, going through all their savings; other businesses might have debts that are slightly more than their rent, but the support would make a huge difference. I fear we may end up with a huge number of businesses being shut out of this important redress, so I urge her and other colleagues to scrutinise this point in Committee.

[Sarah Olney]

That is exactly right, and it is the point I am trying to make. Every context and every business is different. The business owners will have faced different challenges, and the environment in which they trade will have faced different challenges. The hon. Gentleman has already spoken about hospitality businesses facing significant challenges, and it is difficult to see how we can have one set of guidance that covers the viability of every kind of business of every size and every sector.