Unitas Managing Director Darren Goldney has lashed out at the Government’s £600m award of Business Rates relief to Tesco, which yesterday (8 October 2020) announced a £551m profit during the coronavirus outbreak.
Goldney said: “This is a disgrace. The near 30% half-year rise in Tesco’s profit suggests that over the full year it could make an extra £600m – almost exactly the same as the amount of taxpayers’ money the Government is handing over to them.
“On the same day of this profit announcement, independent wholesalers supplying hospitals, care homes, community pubs etc are shedding staff, loss making and reviewing a future of borderline survival.”
Unitas represents 170 regional food distributors; many have lost up to 80% of their custom because of lockdowns, and fear there is worse to come.
“The Scottish Government has shut down the hospitality sector again, and driven consumers back to Tesco and the other national supermarkets,” Goldney continued. “We can see the same happening elsewhere in the UK and whilst we naturally don’t like and may not agree with measures that hurt, we do respect government has to make tough decisions. However, what we can’t respect is an absolute failure to manage fairly the consequence of those decisions and allow ‘viable‘ businesses and jobs go to the wall because they’ve put billions into the wrong place.”
Goldney said it was “absurd” that large supermarket chains should get financial support that enables “huge” profit growth. Highlighting that the hospitality and health care sectors along with other businesses like care homes rely on wholesalers, he said it was “equally absurd” that the Government doesn’t understand the need to keep that supply chain viable.
He continued: “I don’t know how these people can sleep at night – the Chancellor and his team who made such a blundersome initial award, and the Tesco management who I’m sure are good people who have worked really hard, but ultimately have been the recipient of both cash they did not need and huge sales increases on the back of the pandemic.
“On our side, the sleepless nights are caused by wholesalers having received no meaningful support at all, especially the business rate relief that we’ve continually asked for. They have been doggedly keeping open critical routes to care homes, hospitals and hospitality, even making a loss to do so. Some just can’t do it much longer.
Goldney called on the Government and businesses that have received a coronavirus “windfall” to “do the right thing”.
He concluded: “Taxpayers money is finite. The money is in the wrong place and ‘wholesale’ is able to laser target it to those in the supply chain who support outlets that our population rely on.”
Unitas is a member of the Scottish Wholesale Association. Its Chief Executive Colin Smith said the situation “highlights and demonstrates graphically the mistakes government(s) have made in the rush to support industry and where more direct and knowledgeable targeting is required going forward.”