Coronavirus: Rishi Sunak Outlines Further Help for Business

Today, Chancellor Rishi Sunak outlined the next stage of government assistance to businesses and workers following concerns about the end of the furlough scheme and the ability of businesses to survive through the winter with current restrictions.

Sunak announced the following measures:

• The New Jobs Support Scheme
  From November 1, the UK Government will help pay the salaries of employees in work, who can work and be paid for one-third of their working hours. The government will then provide a further third of the person's wage of the remaining hours, giving them a minimum of 77% of their normal wage. This will only apply to small and medium-sized enterprises. Larger employers will only be covered if their turnover has gone down. All employers will be allowed to apply, even if they did not use the furlough scheme.
• Bounce Back loans repayment extension
  Businesses who have used the Bounce Back Loan Scheme will be able to repay their debt over a 10-year period rather than 6 years as previously announced.
• Loans guaranteed for 10 years
  Previously, the government guaranteed business loans for x years. Now, the government will guarantee the failure of repayments to banks for up to 10 years.
• Loan Schemes Extended
  The current range of all coronavirus loans will be extended to 30 November. New schemes will be set to come in January.
• VAT payment delay
  Earlier this year, companies were allowed to delay their VAT payments until March. This repayment can now be spread over an 11-month period with no extra interest.
• Reduced VAT rate extension
  The hospitality industry had been given a cut to VAT from 17.5% to 15%. This was due to end later this year. It will now be extended to March.
• Self-Assessment tax bill
  If needed, the self-employed can now repay their tax bill over 12 months.
• Extending the Self-Employed Support Grant
  The income support for the self-employed will be extended on similar terms to the New Jobs Retention Scheme, giving 20% support for any reduced earnings

The DMA welcomes these proposals, which will help businesses continue to operate during the winter months.

Nonetheless, the DMA believes there is the opportunity to skill up those who are unemployed so that they can get back into the workforce as soon as possible. The DMA, AA and MRS have developed a Skill Up, Power Up, Level Up scheme to provide funding for skills training in the DM industry and beyond.

The proposal argues that a new skills strategy is required to equip UK citizens with the necessary skills to power up and level up the UK economy at pace and with scale. The strategy must not only address the skills deficit that already exists in the UK, but also make provision to re-train workers made redundant following the pandemic, as well as create new opportunities for college and school leavers coming into a market with fewer job prospects.

The strategy proposes a partnership between BEIS and industry associations to help address this situation, with the introduction of a Government grant for free online skills training and qualifications to be provided in the next year by associations to the above categories of workers as well as to SMEs.

This scheme is currently being considered by the Government and the DMA will continue to work with them on this.