BOSS: Coronavirus economic update

This week the prime minister and chancellor unveiled the next level of financial measures to support UK business as hardship levels rise amongst businesses, employees and the self-employed

Further to the specific measures announced, government informed that this was a step in a staged approach and has promised to provide whatever further financial support was necessary, as they seek to support businesses with cash flow stress and ensure that they can manage their fixed costs. To summarise:
Loans to business

  • Up to £330bn to be made available via government backed and guaranteed loans (low interest) so that any business that needs access to cash can get loans/credit at attractive terms.
  • Larger firms – a new lending facility with the Bank of England.
  • Small and medium firms – an extension to the new business investment loan scheme, for loans of up to £5m (at no interest for the first six months).

Grants to business

  • Cash grants of up to £25,000 (available to retail, hospitality and leisure businesses in England with a rateable value below £51,000) to help bridge the economic turmoil.
  • There will be a £10,000 cash grant to small businesses (extended from the £3,000 announcement at the budget). To be delivered by local authorities. This applies to small businesses that pay little or no business rates and are eligible for small business rate relief (SBBR) or rural rate relief will be contacted by their local authority – they do not need to apply. The funding will be provided to local authorities in early April.
  • Expansion to the business rates holiday scheme (for all retail, hospitality and leisure businesses in England) to 12 months.
  • Devolved administrations to receive additional funding.

Support to individuals

  • Mortgage lenders to provide three month mortgage holidays.
  • More measures to come – government will work with trade unions and business groups to protect jobs and income.
  • The IR35 tax reforms have been delayed one year, to April 2021. (This was legislation designed to ensure that self-employed people who work for a company like an employee pay the same level of tax that permanent members of staff pay).

What else

  • The loan scheme should be up and running next week.
  • Local authorities will be managing the cash grants.
  • The government plans to go further with employment support.
  • There was also a reference that an agreement has been made with insurers that companies that had pandemic coverage would receive pay-outs for having to close premises (despite the fact that coronavirus was not listed as a specified disease).
  • Confusion remains regarding the availability of the business grants in the devolved regions.
  • All businesses in Northern Ireland will pay zero business rates from April to June.
  • Some capital finance providers may be able to offer short-term payment holidays.

As a reminder, please note BOSS has set up a dedicated email address for any H&S, legal or business queries you may be facing.
BOSS has also set up a dedicated area on our website to ensure it can keep you up-to-date with the latest information, templates, documents and posters that have been requested, including risk assessing for coronavirus, mental health and self-isolation, and several HR document updates.
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