The moratorium on aggressive debt collection from landlords is set to end next month, meaning thousands of retailers could face legal action as total rent debt is estimated to be £2.9bn.

A survey of retailers by the British Retail Consortium (BRC) stated that two-thirds have already been informed they will be subject to legal measures after the moratorium ends on June 30.

A third have already experienced legal action in the form of county court judgements from commercial landlords. 

The end of the moratorium comes after ’non-essential’ retailers experienced extended closures over the past 15 months.

The BRC also reports that 80% of tenants said some landlords have given them less than a year to repay rent arrears that accumulated during the pandemic.

Although the government introduced a code of practice last year in response to the ongoing debt issues, two-thirds of those surveyed described it as “ineffective” as it remains voluntary.

BRC chief executive Helen Dickinson said: “Many retailers have taken a battering over the pandemic, but they are now getting back on their feet and playing their part in reinvigorating the economy.

“The unpaid rents accrued during the pandemic, when most shops were shut, are a £2.9bn ball and chain that hold back growth and investment, and could result in a tsunami of closures.”

“Government must ringfence the rent debts built up during the pandemic, giving retailers breathing space as they wait for footfall and cash flows to return.

“With this in place, all parties can work on a sustainable long-term solution, one that shares the pain wrought by the pandemic more equally between landlords and tenants.

“Without action, it will be our city centres, our high streets and our shopping centres that suffer the consequences, holding back the wider economic recovery.” 

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