The hugely damaging wave of strikes by transport and public service unions at the peak of the festive season threatens to cost the central London economy close to £2 billion in lost spending, businesses leaders warned on Friday.
Walkouts by rail staff, Border Force officials, postal and other workers will bring weeks of disruption to the capital at a time when many companies can least afford it after two years of Covid-ravaged Christmases.
Under pressure RMT union boss Mick Lynch raised hopes on Friday morning that strikes on Network Rail at Christmas may be called off at the eleventh hour. The RMT is looking increasingly isolated as the TSSA and Unite unions, which have far fewer members on the train network, agreed deals with rail chiefs.
However, the second of two 48-hour strikes by rail workers started on Friday.
London and the rest of England is also braced for walkouts by nurses and ambulance crews next week. In the capital, restaurants, bars and pubs that would normally be packed in the run up to Christmas have already been hit by mass cancellations that will cost the sector an estimated £750 million.
Meanwhile retailers are set to lose even more because of the timing of a strike on Boxing Day and again in early January that will bring havoc to the West End sales and could cost central London stores and other businesses as much as £1 billion.
Hospitality and retail losses are estimated at a combined £1.75 billion while a no-show of tourists worried about airport delays would push the total hit to close to £2 billion.
The planned walkout by Border Force workers in late December will affect more than 7,000 inbound flights to Heathrow and Gatwick with around 1.5 million seats.
The “Season of Bad Will” began on Tuesday when more than 40,000 members of the RMT union across Network Rail and 14 train operating companies walked out for 48 hours in their dispute over better pay and conditions.
The industrial actions left the West End and the City largely deserted on what should have been one of its busiest pre-Christmas trading days.
One leading restaurateur said “it’s like Omicron all over again”. Another walkout is due on Network Rail from 6pm on Christmas Eve until 6am on December 27, and then two more 48 hour train stoppages on January 3, 4, 6 and 7.
There will also be an overtime ban from December 18 until January 2, which means the union will be taking industrial action for four weeks. But after talks with rail minister Huw Merriman and train firm bosses last night, RMT general secretary Mr Lynch raised hopes that a deal could be reached “in the next week or so”, possibly initially to avert the Christmas strikes.
Mr Lynch played down the impact of the Christmas walk-outs given that so few trains normally run then. He told Sky News: “People have got time now to make plans. I hope that they’re successful in that, and that we can progress these talks to maybe get some solutions in the next week or so.” A Whitehall source said: “Last night’s meeting between the rail minister and the negotiating parties was cordial and professional but there is still some work left to be done.”
The stand-off between unions and rail chiefs, though, means thousands of restaurants, bars, hotels and clubs are already facing a third consecutive heavily-disrupted “party season”. London is disproportionately vulnerable to the RMT shutdown as close to half of all rail journeys begin or end in the capital. The City and Docklands were particularly badly hit with Transport for London recording entries and exits at stations such as Bank, Canary Wharf and Mansion House at 50 per cent of pre-pandemic levels on a strike day this week, compared with 72 per cent of pre-pandemic levels last Tuesday.
Kate Nicholls, chief executive of HospitalityUK, estimated that around £1.5 billion worth of bookings were at risk over December and January with at least half of those at London venues.
She said: “It’s not just the people who work in London. You also have the people cancelling shopping or theatre trips, they usually go out for a meal as well.”
Professor Joshua Bamfield, director, Centre for Retail Research, said the rail strikes blow to the number of visits to London was “likely to shave” between 10 per cent to 20 per cent off Christmas spend in London and the same proportion off the Boxing Day-January sales, amounting to a total of around £1 billion of revenue.
Richard Burge, chief executive of London Chamber of Commerce and Industry, said: “Businesses do not deserve this disruption, nor did they ask for it. All actors in these disputes must sort this mess out for the sake of London.”
