This week, chancellor Rishi Sunak set out his “winter economic plan”, outlining how the government plans to help businesses after Covid-19 restrictions were tightened by the prime minister.
Alongside the new Jobs Support Scheme, which will replace the furlough scheme and come into action from November 1, Sunak has said that there will be an extension to the repayment window for businesses who have borrowed money through the government’s bounce-back loan initiative, while the VAT cut for hospitality and tourism companies has been extended to the end of March 2021.
Businesses who deferred their VAT will no longer be required to pay a lump sum at the end of March and have been given the option of splitting repayments into smaller, interest free repayments over the course of 11 months.
The Treasury has said that up to half a million businesses could benefit from the measures.
One such business is Florence Roby, a family-owned business in Prescot, Merseyside, specialised in the design and manufacture of workwear for the hospitality, beauty and leisure industries.
At the beginning of lockdown, the business diversified into healthcare and diverted its production toward producing personal protective equipment for frontline NHS workers.
Lloyds Bank stepped in at the time to support the business with a six-figure loan and capital repayment holiday through the government's Coronavirus Business Interruption Loan Scheme.
Speaking to Insider, Glenn Bemment, regional director at Lloyds, commented: "Through all the turmoil, I've been struck by just how many firms have innovated during lockdown, diversifying and pivoting their models – discovering profitable new ways to operate that will be made permanent.
"The months ahead will likely bring new hurdles for north west businesses to overcome, but there will also be opportunities for recovery and growth. While it will no doubt be a gradual process, we look forward to seeing the region's confidence rise once again as firms find success in whatever lies ahead."
In response to the chancellor’s measures, Dame Carolyn Fairbairn, director general of the Confederation of British Industry, said: “These bold steps from the Treasury will save hundreds of thousands of viable jobs this winter. It is right to target help on jobs with a future but can only be part-time while demand remains flat. This is how skills and jobs can be preserved to enable a fast recovery.
“Wage support, tax deferrals and help for the self-employed will reduce the scarring effect of unnecessary job losses as the UK tackles the virus. Employers will apply the same spirit of creativity, seizing every opportunity to retrain and upskill their workers.
“The chancellor has listened to evidence from business and acted decisively. It is this spirit of agility and collaboration that will help make 2021 a year of growth and renewal.”
National chair of the Federation of Small Businesses, Mike Cherry, added: “The UK’s small businesses are facing an incredibly difficult winter. [This] support package is the flipside of the coin to Tuesday’s Covid-19 business restrictions.
“It is a swift and significant intervention, extending emergency SME loans, creating new wage support for small employers and the self-employed, and providing cashflow help on VAT deferrals and new Time To Pay for any tax bills to HMRC.”
Photo by Michael Longmire on Unsplash
