Torbay Council’s leadership is urgently asking the Government to extend the furlough scheme for tourism and hospitality workers.
They are worried that there could be a big rise in job losses when the current scheme finishes in October at the same time as the end of the holiday season.
The partnership of Independents and Liberal Democrats running the council is also trying to persuade the Government to let it keep leftover business support cash which has not been claimed.
Under the current rules, the surplus from the schemes delivered by the council has to be returned.
The last grants of £10,000 or £25,000 to businesses have to be paid out today (Friday, August 28) when the coronavirus support schemes end.
By the end of July the council had paid out £36million to eligible businesses – leaving around £11million in the pot.
Councillors were told the authority and its economic development company TDA had worked hard to contact all eligible companies.
It is believed the Government over-estimated the amount Torbay would need.
The council’s deputy leader Darren Cowell said it was hoped that some of the money could go towards training for people losing their jobs.
Cllr Cowell said: “We had 16,000 employees on furlough at its peak. A lot of those are still furloughed.
“When the tourism season ends, coupled with furlough coming to an end, it is imperative to find support both locally and nationally for that sector.
“We are putting as much pressure as we possibly can to retain a specific part of that fund.”
Councillors have been told Torbay is particularly at risk of a post-Covid recession due to deprivation, its reliance on tourism, and a relatively older population.
The latest estimates suggested around 2,600 people in Torbay could lose their jobs due to the pandemic.
That was scaled back from an earlier estimate of between 12,000 and 18,000 redundancies.
Councillors heard that some people were saying Torbay was currently busier than it ever had been with visitors.
But some managers in the sector were saying numbers were level with last year, and there were concerns that the loss of income due to the shortened season would mean further job losses in the winter.
“Some will have dozens and dozens of redundancies coming down the line, if there is not a bespoke furlough scheme,” the council’s leader Steve Darling told a meeting of the overview and scrutiny board.
Conservative councillors and former Torbay mayor Nick Bye said he had never seen the area so busy, and highlighted the positive effects of the Government’s half-price Eat Out to Help Out scheme and VAT cut for the hospitality sector.
Councillors were told the Government was believed to have miscalculated the amount of money allocated to Devon for the Growth Support Kickstart Grant Scheme offering up to £3,000 to small businesses including those in the tourism sector.
They heard the allocation would be used up if just one in 20 businesses received £1,000. The Devon and Somerset area has been given just over £770,000 from £30million nationally from the scheme to help economic recovery, with £10million targeted at tourism.