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£150m cost of Diamond Jubilee
THE Queen’s Diamond Jubilee celebrations could cost the Hampshire economy a staggering £150m in lost business.
That’s the stark warning from leading accountants as Hampshire and the Isle of Wight prepares for hundreds of street parties and other ways to make the best of the extended bank holiday weekend.
The cost to the local economy will come in lost productivity as businesses close down for another day and people take three days leave to get a whole week off, according to south coast accountants James Cowper.
It’s the second consecutive year that the UK has had an extra day off.
Mike Farwell, a partner at James Cowper, which has offices in Southampton, said: “Based on the region’s economic output, the extra day may cost £150m in lost Business. Some commentators are even arguing that the impact could hinder efforts to pull the country out of recession.
“But it is also important to remember that there may be a significant boost for sectors such as tourism, restaurants, pubs and retailers.
“With an impressive array of events planned across Hampshire and the Isle of Wight, the Diamond Jubilee promises to be highly memorable.
“Most importantly the ‘feel-good factor’ that the celebrations will bring and the benefits of returning to work fully refreshed after a break are something even the best accountant can’t measure.”
Yet his concerns have been echoed elsewhere.
The Centre for Economics and Business Research (CEBR) has estimated that each bank holiday costs the UK economy £2.3 billion in lost productivity – and scrapping bank holidays could boost Britain’s economy by £19 billion each year.
While the CEBR agrees that sectors like retail, wholesale, hotels and restaurants can benefit, it points out these areas together account for about only 14 per cent of the economy.
Meanwhile the sectors losing out from bank holidays – offices, factories and construction sites – account for about 47 per cent of the economy.
Governor of the Bank of England, Sir Mervyn King, has also warned that the Jubilee bank holiday could affect the economy’s recovery from recession.
But Chris Turner, chief executive of Winchester Business Improvement District, questioned whether the boost to the leisure economy was factored into the Hampshire statistic.
“It is ignoring the boost for pubs and restaurants, the take-up of extra staff.
“A third of the Winchester BID members are footfall-oriented and there’s great enthusiasm for the Jubilee and the Olympics.”
Professor Turner warned: “We are talking ourselves into a downward spiral.
"This is an opportunity to talk ourselves up a little bit.
"There is zest in parts of the economy but I can understand if you are in manufacturing and you have staff not coming in because of the holidays it would be a bit of a bind.”