Tesco to return £585m in coronavirus hand outs after backbench Tories pile on pressure | UK | News (Reports)


The supermarket giant said it will return cash it saved from the business rates holiday introduced to help struggling retailers. Chairman John Allan said the company is “conscious of our responsibilities to society” and it did not need the money after strong trading throughout the pandemic. It follows pressure from the Blue Collar Conservative group of MPs for supermarkets to give back the £1.9 billion they reaped from the tax exemption. Tory MP Esther McVey said: “Blue Collar Conservatives congratulate Tesco for the leadership it has shown in returning this money.

“They have listened and acted swiftly. We now expect the other supermarkets to follow suit.

“We will press the Chancellor to use this money to help those who have had no support at all from the government during this pandemic. “

The government has been urged to hand the cash to the hospitality sector, one of the hardest hit sectors during the crisis.

No 10 was unable to say whether the money would go back into the general spending pot or would be used to help other businesses.

A spokesman said: “We continue to provide support to businesses and we will continue to do so while it is required.”

Sainsbury’s, Asda, Aldi, Lidl, Morrisons, Waitrose and Iceland have refused to say if they will follow Tesco’s lead.

Co-op said the amount it has spent on protecting staff and customers outweighed the savings.

It added: “Given the huge uncertainty we’re facing into still and the ongoing costs we are incurring, we’ll consider our approach in terms of the Government support we’ve received at year end.”

Analysis found Tesco, Sainsbury’s, Asda, Morrisons, Aldi and Lidl would save around £1.87 billion as a result of the rates holiday, around a sixth of the total £10.1 billion bill that has been written off for all businesses this year.

In October, Tesco revealed it made a pre-tax profit of £551 million in the six months to August 29 – an almost 29 per cent increase compared with the same period in 2019.

Tesco chief executive Ken Murphy said the company spent £725 million on improvements and safety measures – including increasing online sales.

He said: “While business rates relief was a critical support at a time of significant uncertainty, some of the potential risks we faced are now behind us.

“Giving this money back to the public is absolutely the right thing to do by our customers, colleagues and all of our stakeholders.”

Rates relief was first announced by the Chancellor for retail, leisure and hospitality firms until March 2021.

Analysis from Altus Group showed that Sainsbury’s is expected to save £498 million from its rates holiday for the year – although Sainsbury’s said it was closer to £450 million.

Asda is projected to save £297 million, Morrisons around £279 million, Aldi £109 million and Lidl £108 million, for the year.


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