Publication - Impact assessment

Coronavirus (COVID-19) business support: equality impact assessments

Published: 11 March 2022
From: Director-General Economy
Topic: Business, industry and innovation, Coronavirus (COVID-19) in Scotland, Economy
ISBN: 9781804351864

Detailed equality impact assessments (EQIAs) for the COVID-19 business support funding issued between March 2020 and April 2021.

Supporting documents

Creative Tourism and Hospitality Enterprises Hardship Fund

Name of Grant:

The Creative, Tourism and Hospitality Enterprises Hardship Fund (CTHEHF)

Policy Lead

Legal power used:

Overarching legal powers to take emergency action due to Covid-19

Grant Overview:

Managed by the Enterprise Agencies with support from Creative Scotland and VisitScotland, the fund provided bespoke funding for small and micro creative, tourism and hospitality companies experiencing hardship as a result of Covid-19. The focus was to help companies manage cashflow commitment, including those furloughing staff.

The fund provided grants of up to £25,000 for businesses not in receipt of business rates grants.

The fund was needs based, which meant applicants had to demonstrate financial hardship as a result of Covid-19 as well as meeting the following criteria:

Companies with up to 49 employees
Experienced at least a 50% loss of current or projected revenue
Not in financial difficulty before 31 December 2019
You cannot be in receipt of other COVID-19 government grant support, apart from the Furlough Scheme or self-employment income support
Not for pre-revenue companies
Must have a business bank account

Executive Summary:

The extraordinary measures taken by the Scottish Government to protect the right to life and right to health for the people of Scotland throughout the Covid-19 pandemic have placed unprecedented pressures on Scotland’s economy and business community. Health protection regulations required certain businesses to close or placed specific restrictions on their operations at different times between March 2020 and August 2021. Many others were impacted by significant reductions in demand due to these restrictions or as a result of the introduction of domestic and/or international travel restrictions.

Since the start of the pandemic, the Scottish Government has spent £4.4 billion in providing direct financial support to those businesses impacted by Covid-19 restrictions and regulation. As the impacts of restrictions were felt differently across the business community, varying according to factors such as sector and location, a range of different funding streams were developed to target financial support towards specific sectors or types of business based on the challenges they were experiencing as a result of the pandemic.

Given the unprecedented challenges presented by Covid-19 it was necessary to develop financial support schemes at pace to ensure that funds were distributed rapidly in the interests of preventing business closures and preserving jobs. The Creative, Tourism and Hospitality Enterprises Hardship Fund was no exception to this. Within this context, there has been limited opportunity to gather evidence on the possible impacts of the business support fund. However, from the start of the pandemic, the Scottish Government has considered the lockdown provisions against the needs of the general equality duty as set out in section 149 of the Equality Act 2010 to eliminate unlawful discrimination, harassment and victimisation, advance equality of opportunity between people who share a protected characteristic and those who do not, and foster good relations between people who share a protected characteristic and those who do not. The Scottish Government has also considered whether the measures could constitute direct and/or indirect discrimination.

In many cases, the provisions have applied to all persons irrespective of protected characteristic, although it is acknowledged that the same provision may not have equal impacts.

Every effort is made to ensure that Equality Impact Assessments (EQIA) are published timeously. However, the speed at which it has been necessary to ensure mechanisms are in place for supporting businesses impacted by Covid-19 restrictions has resulted in delays to completing EQIAs for a number of business support funds. However, the Scottish Government completed an Equality Impact Assessment on the Strategic Framework to assess the policy impact on diverse groups and individuals, and this overarching EQIA provided the context in which the business support grants, including Creative, Tourism and Hospitality Enterprises Hardship Fund, were developed.

Key Findings - impact assessment of benefits and/or disadvantages.

By distributing financial support through these funds, the Scottish Government acted to mitigate the impact of these regulations on businesses to support them in remaining financially viable while restrictions were in place. In doing so, this assessment shows that the funds acted to advance equalities by protecting businesses in sectors that impact on the lives of those with protected characteristics disproportionately.

This emergency funding has supported otherwise viable businesses, protecting the business base, jobs and livelihoods of people across the range of protected characteristics, many of whom have been disproportionately affected by COVID-19.

Age: Older People and Children and Young People

There is extensive research on the detrimental impacts of

restrictions introduced to control the spread of Covid-19 on

children and young people. Particular attention has been paid to the impact of restrictions on the incomes and career prospects of young people both of which have been specifically recognised by the Scottish Government. Employment figures published by the Office for National Statistics (ONS) show the extent to which the impacts of Covid-19 on the labour market in Scotland have fallen disproportionately on young people.

The long term ‘scarring’ impacts of the pandemic on the career prospects of young people have also been highlighted by organisations such as the Institute for Fiscal Studies (IFS) and the Social Metrics Commission the latter of which has shown that young people (18 -24) are 7% more likely to experience a negative labour market outcome as a result of Covid-19 that those aged 25-44.

Sex: Men and Women

Visitor accommodation provides an important contribution to Scotland’s visitor economy. Almost 53,000 jobs are provided by the accommodation sector as a whole (BRES 2018), with GVA for Accommodation at more than £1.6bn in 2017.

The tourism sector has a disproportionately young workforce compared to other sectors. 36% of the accommodation and food services sector workforce is aged 16-24, compared to 12% overall for Scotland^[45].

An assessment of the restrictions introduced at this time showed that, like young people, these also had a disproportionate impact on women primarily driven by two factors, high numbers of women-led businesses in the retail, hospitality and leisure sectors as well as a clustering of female employment within these sectors.

According to the Small Business Survey, in 2018, 15%^[46] of SME employers were women-led (controlled by one woman or have a management team of which a majority are woman) and 73% of SME employers were family-owned.

According to Annual Population Survey 2019, women constitute 52.3% of the tourism workforce^[47].

The CTHEHF contributed to advance equality of opportunity for women. Given a higher proportion of the workforce within the tourism sector are likely to be women, the Fund impacted directly by safeguarding jobs with hardship funding made accessible to aid future business viability.

As this fund contributed to maintaining the financial viability of small and micro creative, tourism and hospitality businesses, it is thought that this will also act to preserve jobs for a wide range groups, including young people and women.

Race

We do not have statistics breaking down race, however, according to the Small Business Survey, in 2018, 2%^[48] of SME employers were minority ethnic group led.

Previous economic recessions have also disproportionately impacted minority ethnic employment, and this could be something that is repeated as a higher share of the visible minority ethnic population in employment work in the hospitality industry (31.7% vs 18.6% of the white population)^[49].

At the time of the last Census in in 2011 it could also be seen that Gypsy/Travellers are also most likely to be employed in the hospitality sector - 31% of all those who were employed, compared to 21% for the employed population as a whole^[50] Asian men and women (20%) were particularly likely to be working in wholesale and retail and accommodation and food services in 2011 compared to 6% for the employed population as a whole^[51].

Consultation with stakeholders revealed the importance of tailored support for the sector this fund aimed to support during the pandemic in order to mitigate the economic impact of this unparalleled crisis. Our main concern was to design a funding scheme that would be inclusive for each SME, provided they were able to evidence meeting the criteria.

As this fund contributed to maintaining the financial viability of specific small and micro businesses it is thought that this will also act to preserve jobs for a wide range groups.

Disability

Due to the intent of this Fund to cover a wide range of sectors, it is difficult to acquire disability data on it as a whole. However, the below data indicates there is a potential for a marginally different positive impact on non-disabled groups via this fund:

In 2019, the employment rate for those classed as disabled under the Equality Act 2010 was 49.0 per cent which was significantly lower than the employment rate for non-disabled people (81.6 per cent). In 2019, the disability employment gap was 32.6 percentage points.
The disability employment gap was lower for women (27.5 percentage points) than men (38.2 percentage points) for ages 16 to 64 and across all other age bands. The disability employment gap was lower for young people and increased with age, with the gap being highest for those aged 50 to 64 years, for both women and men^[52].