Following my call for questions on Tuesday, I’ve heard from lots of local businesses of all sizes and industries from across my constituency who are extremely concerned about the impact of COVID-19 on their livelihoods, the people they employ and their loved ones. From taxi drivers to childminders, from café owners to designers, it’s clear that this is a worrying time for everyone.
I’ve summarised the help that the Chancellor has announced for businesses so far below. At this stage, for many businesses, I know that this information may raise more questions that answers and won’t go far enough to ease anxieties. But, rest assured, I’ll keep you updated with any further information and continue to ensure your concerns are heard loud and clear.
The full list of support provided by the government is available to view online here: https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19
Loans for businesses
The Chancellor has announced £350bn in state-backed loans for all businesses through the banking system with the help of the Bank of England (around 15 per cent of the value of the economy). This is to help businesses pay their bills during the crisis.
A new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will support small and medium sized businesses to access bank lending and overdrafts. The government will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims). The government will not charge businesses or banks for this guarantee, and the Scheme will support loans of up to £5 million in value. Businesses can access the first 6 months of that finance interest free, as government will cover the first 6 months of interest payments. This scheme will be available from next week. I’ll keep everyone updated know as we gain more information.
To support larger firms, the Bank of England has announced a new lending facility to provide a quick and cost effective way to raise working capital via the purchase of short-term debt. This will support companies which are fundamentally strong, but have been affected by a short-term funding squeeze, enabling them to continue financing their short-term liabilities. It will also support corporate finance markets overall and ease the supply of credit to all firms Information on this scheme will be available from next week.
The government will introduce a business rates retail holiday for a year retail, hospitality and leisure businesses in England for the 2020 to 2021 tax year. Guidance on this is expected to be published by Trafford Council on around 20 March.
Businesses that received the retail discount in the 2019 to 2020 tax year will be rebilled by the council as soon as possible.
Furthermore, a £25,000 grant will be provided to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value between £15,000 and £51,000. Cash grants of £10,000 for the UK’s 700,000 will be available to companies which pay little or no business rates.
Businesses may be eligible for support through HMRC’s ‘Time to Pay’ scheme. HMRC have set up a dedicated helpline for businesses who are worried about being able to pay their tax – 0800 0159 559.
Expansion of statutory sick pay and access to benefits
The government will bring forward legislation to allow small- and medium-sized businesses and employers to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19. However, the government haven’t extended eligibility for SSP to workers paid less than the threshold of an average of £118 a week or to the self-employed.
For those not eligible for SSP (including the self-employed) the government have suggested they claim other benefits: ‘new style’ Employment and Support Allowance and Universal Credit. The usual rules around claiming Universal Credit and ESA have been relaxed to make it easier for people to access this support (e.g. people don’t have to attend the JobCentre in person and no longer need a minimum income before claiming Universal Credit).
You can find more information about claiming benefits during the Coronavirus here: https://www.understandinguniversalcredit.gov.uk/coronavirus/
I understand that navigating the benefits system may be difficult, especially if you have little or no experience of this. However please ensure you claim what you’re entitled to for helping yourself and your family during this time.
Further useful sources of information and advice
The government’s Business Support Helpline: 0300 456 3565 (Monday – Friday 9am to 6pm)
Turn 2 Us (a charity providing financial support): https://www.turn2us.org.uk/