Bank holidays cost UK economy 19 billion pounds: Think-tank

PTI Apr 9, 2012, 09.47PM IST

LONDON: If bank holidays, each costing the UK's economy 2.3 billion pounds were scrapped, the country's gross domestic product (GDP) would be 19 billion pounds higher every year, a think-tank has estimated.

This year's extra bank holiday for the Diamond Jubilee marking the 60th anniversary of the accession of Queen Elizabeth II means there are five holidays in April, May and June outside Scotland, where Easter Monday is not a holiday.

Wales and England usually have eight, Scotland nine and Northern Ireland 10.

The Centre for Economics and Business Research (CEBR) says that if bank holidays were scrapped, Britain's GDP - a measure of the value of goods and services produced by all sectors of the economy - would be 19 billion pounds higher every year, the BBC reported.

The think-tank says the UK depends far more on services than other countries and that sector - with the exception of the hospitality industry - tends to work far less on public holidays.

CEBR founder Douglas McWilliams: "About 45 per cent of the economy suffers; the offices, the factories, the building sites where people tend not to go to work on bank holiday."

He told the BBC that 15 per cent of the British economy, such as shops, pubs, restaurants and visitor attractions do well.

However, McWilliams said that by spreading out public holidays, rather than scrapping them, people would enjoy them more.

Business can "lose momentum" when there are too many close together, he added.

The CEBR points to South Korea, which has recovered rapidly from the financial crisis. Although there are more public holidays there, the think-tank says different working conditions mean employee work over 500 hours more per year than British workers.

Unions have previously pressed for extra public holidays, pointing out that other European countries have more than the UK's minimum of eight.

Research published last year by Mercer HR suggested there was a statutory minimum of 14 in Spain, 13 in Portugal, 12 in Greece, 11 in France, and nine in Germany and Ireland.

It found US and Australian workers get 10 public holidays, Canadians nine, Chinese 11 and Japanese 15. However, there are regional variations in many of these countries and employment laws differ as to whether workers should be paid for these holidays.

Recently, the Governor of the Bank of England, Mervyn King, warned that GDP in the second quarter of this year might shrink owing to the number of bank holidays.