News & Insights
The CTA has written to Robert Jenrick, Secretary of State for Housing, Communities & Local Government, proposing that the government waive 50% of pandemic rent debts.
The move, which is similar to the model adopted in Australia, would write off billions of pounds of accumulated rent debt across multiple business sectors.
The government extended the eviction moratoria again in June, through to March 2022, providing welcome security to thousands of commercial tenants across the UK.
However, the issue of how outstanding rent would be recovered was largely left in limbo, prompting the CTA to push the government to commit to supporting businesses that are still struggling to reach their full operating potential.
“What we’re really calling for is for the government to impose a minimum of 50 per cent rental relief, in the form of a waiver to be agreed between the landlord and tenant. We think the government should be giving landlords some support with that.
“We’re hoping that arbitration is set up in a way that’s open, fair and transparent. We want to see a fair scenario where tenants are listened to and have an opportunity to present their financial position in private arbitrations versus going to court, which then becomes more public.”
The moratorium was put in place to curb a wave of business failures after the pandemic hit, though there are now growing concerns that many businesses will face a cliff edge when government support, including rates relief, VAT deferral and furlough comes to an end.
The CTA recommends that rental debt from the first lockdown should be ringfenced until a settlement is reached between both parties, though landlords must offer their struggling tenants rent relief of no less than 50 per cent. This offer must also be accepted within 21 days of heading to arbitration.