The Prime Minister and head of the national government, Pedro Sánchez, together with the Valencian President Ximo Puig, visited the Miguel Hernández Station in Orihuela yesterday (Monday 1st February) as part of the first trip of the AVE high speed rail link from Madrid to the Oriolan city.
The occasion was used by business owners from Orihuela Costa to drive in convoy to Orihuela to hold a peaceful protest against the lack of financial support from Pedro Sanchez and Ximo Puig for the hostelry sector.
Around 30 cars weaved their way from the Coast and protested along the road to the railway station and around traffic island at its entrance. Their message was clear – we need financial help and we need it now. In order to get the message across the protesters waved banners with slogans such as “Where have the Millions from Europe gone”, “Closed bars, Politicians on full salaries” and “We need help for our businesses” and honked their horns relentlessly.
The current closure of bars and restaurants is one of the measures designed to stop covid-19 killing people but in so doing, local hostelry owners believe it has killed the tourist trade and tourism related businesses.
Since the Covid-19 pandemic began in March 2020 businesses have been regularly closed or restricted against the will of their owners and staff and yet little has been done to ensure these businesses survive. In a recent Spanish news programme they showed a graph of the help given by other countries in Europe to the hospitality industry In Billions of euros: Denmark 50, Netherlands 15, Germany 10, France 6, UK 5.1, Italy 5.4, Romania 2 and Spain 0€ (zero).
Through the ERTE scheme employees received about 70 percent of their declared wages minus their social security payment. However, local business owners feel the scheme has numerous flaws. If any member of staff is let go in the next 12 months the employer must pay back all of the ERTE received by the employee. Some employees have to wait for 6-9 months before they get their first ERTE payments. Payments from the Social Security are means tested very difficult to get. In addition, employers have to pay full social security (about 400€ per month per full-time employee) whether the employee is working or not. There are no grants or financial aid for businesses.
Even outside of the forced closures, most small businesses can´t afford to open because there are no tourists and no investors. Electricity rates have doubled, rents, mortgages, SUMA, rubbish collection etc still have to be paid. It’s no wonder that local business associations estimate that more than 50 percent of businesses are closed, never to reopen.
The government promised business loans but the banks only lend to people who are low risk. All small businesses are now high risk and so they cannot get loans, but who in their right mind would go into debt with such an unsure future.
Peter Houghton, President of PIOC, says: “As of the 21st January 2021, 85,000 businesses have closed with a loss of over one million jobs in the hospitality industry alone. Businesses and their employees 11 months ago were contributing to the national economy are now seeking out food banks to feed their families.”
Raymond Kearney, Orihuela Costa Avanza Business Association said: “Other European countries have given cash injections to their hospitality sector, they have helped them get through this Covid World War but Pedro Sanchez has given nothing and Ximo Puig very little. These governments are destroying all small to medium sized businesses. Already 55 percent of the population are in jobs paid by the government or on pensions and disability benefit, this is pure communism.”
What small businesses need right now is direct cash injections (not loans or schemes), temporarily stopping of Social Security payments, removal of the ERTE penalties and to allow employees to claim unemployment benefits until this pandemic is behind us and freedom of movement between countries is restored.