Chancellor announces additional £300 BILLION to keep UK afloat
The Chancellor Rishi Sunak has announced unprecedented support for business and workers to protect against the economic emergency caused by the coronavirus.
This includes unlimited loans and guarantees to support firms and help them manage cashflows through this period. The Chancellor will make available an initial £330 billion of guarantees – equivalent to 15% of UK GDP – and there could be more to come.
At last week’s Budget, the Chancellor 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.
He said he would take further action as the situation evolved and today outlines further measures, including:
To ensure that businesses have access to the funds they need, \the UK Government will provide:
- 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 us 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.
To support the food industry and help provide meals for people who need to self-isolate, the UK government will relax planning regulations to allow pubs and restaurants to start providing takeaways without a planning application.
The Chancellor of the Exchequer Rishi Sunak said: “We will do whatever it takes to protect our people and businesses from the effects of this global economic emergency brought on by the Coronavirus pandemic.
“The interventions I am setting out today will help support businesses of all sizes – so they can continue operating during these unprecedented times.”
The action announced yesterday 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.
The Chancellor will expand on his plans to keep the economy afloat later today and an announcement of support for people who live in rented accommodation is expected this week.
Labour’s John McDonnell MP, Shadow Chancellor, responding to Chancellor Rishi Sunak’s coronavirus update, said: “People are being laid off today and losing their incomes. We are disappointed that this package does not address their concerns.
“The further announcements laid out by the Chancellor lack the certainty required amidst growing public anxiety and still do not go far enough in protecting workers, renters and those who are losing their jobs, or in fully supporting businesses at the scale necessary.
“In particular, the Chancellor’s claim that new forms of employment support will be developed does not appreciate the urgency and gravity of the situation. Workers and businesses need to know now that they will be supported, not in a few days’ time.
“Labour will continue to engage with the Government to ensure we have the proper scale of interventions required to secure proper funding of public services at the time of crisis, public control and oversight of those key services, a strong safety net, and the wellbeing of all.”
Gareth Shaw, Head of Money at Which?, said: “The measures announced by the chancellor, such as a three-month mortgage holiday scheme, are an important first step to helping millions of consumers who may face financial hardship during the coronavirus crisis.
“The government must move swiftly to ensure those in need of assistance get clear information about how these schemes will work in practice – and that the process for doing so is straightforward, ensuring consumers can easily access the support they need in the challenging months ahead.”
Responding to chancellor Rishi Sunak’s package of support for businesses and the prime minister’s pledge to do `whatever it takes’ to support people and jobs through the corona virus crisis, the head of the UK’s leading union, Unite, has said that his union stands ready to play their part throughout this time of crisis.
Len McCluskey, Unite’s general secretary said: “It is abundantly clear that we need a package of measures equal to the public health and economic emergencies now upon us.
“Urgent and considerable action is needed by government to avert personal and industrial catastrophe.
“Unite is pleased to have heard the prime minister and chancellor say very clearly that they `will do whatever it takes’ to protect public health and the economy’s health. We will hold them to that.
“However, we remain extremely concerned that workers’ and individuals’ own capacity to act on the public health advice will remain seriously compromised because the direct economic support has not yet been provided by government. This must change and urgently. Providing wage support and covering rents must be a priority.
“It is welcome that those hit by the virus will have a three month mortgage holiday should they need it, but what about the vast majority of people who rent? They need to know that they can put food on the table and keep a roof over their families’ heads. Only then will they feel able to play their part in tackling this public health emergency.
“We urgently need for the government to introduce now the sort of measures that we have seen implemented in our competitor nations, including paying workers 75 per cent plus of their salary while they are forced to be at home as has been introduced in Denmark and Holland. UK workers deserve the same efforts and assistance.”
