Government announces additional support to protect businesses
The Government today announced unprecedented support for business and workers – to protect against the economic emergency caused by CVOID-19.
This includes unlimited loans and guarantees to support firms and help them manage cashflows through this period. The Government will make available an initial £330 billion of guarantees – equivalent to 15% of UK GDP.
At last week’s Budget, the Government provided £30 billion of support to the economy to deal with the crisis by investing in public services, increasing support for vulnerable people and providing business with tax reliefs and loans.
The Government stated that it would take further action as the situation evolved and today outlined further measures including:
To ensure that businesses have access to the funds they need, Government are providing:
- support for liquidity amongst large firms, with a major new scheme being launched by the Bank of England to help them bridge Coronavirus disruption to their cash flows through loans
- increasing the amount businesses can borrow through the Coronavirus Business Interruption Loan Scheme from £1.2 million to £5 million, and ensuring businesses can access the first 6 months of that finance interest free, as Government will cover the first 6 months of interest payments
- including new legal powers in the Covid Bill enabling them to offer whatever further financial support we think necessary to businesses
Providing £20 billion of business rates support and grant funding to help the most-affected firms manage their cashflow through this period by:
- giving all retail, hospitality and leisure businesses in England a 100% business rates holiday for the next 12 months
- increasing grants to small businesses eligible for Small Business Rate Relief from £3,000 to £10,000
- providing further £25,000 grants to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value over £15,000 and below £51,000
Mortgage lenders have agreed they will support customers that are experiencing issues with their finances as a result of COVID-19, including through payment holidays of up to 3 months. This will give people the necessary time to recover and ensure they do not have to pay a penny towards their mortgage in the interim.
Confirmation that government advice to avoid pubs, clubs and theatres etc. is sufficient for businesses to claim on their insurance where they have appropriate business interruption cover for pandemics in place.
The action announced today means that over £3.5 billion in additional funding will be provided to the devolved administrations for support to businesses in Scotland, Wales and Northern Ireland.
More specific measures tailored to the transport industry will be announced in coming days.