The British Chambers of Commerce is calling on the Government to provide more financial support to businesses across the UK facing a bleak future from the debilitating squeeze of coronavirus restrictions.
Cash strapped businesses need measures to support cash flow such as extending and expanding business rates relief, prolonging VAT deferrals and offering an immediate, further round of upfront cash grant support – at least equivalent to levels of around £25,000 available in the first national lockdown – with sufficient funds to provide for all businesses that need it in every sector.
More certainty is also needed to help protect jobs and livelihoods by maintaining the Job Retention Scheme, until a full reopening of the economy is possible, and expanding income support for limited company directors. Businesses cannot afford to wait until the Chancellor’s budget in March; they need these measures now and a guarantee that support will be available throughout the year so they can plan for more than a few weeks ahead. The impact of the pandemic is increasingly being felt away from the sectors which have been most obviously hit by the restrictions, such as hospitality and leisure.
BCC has also urged ministers to work closely with companies across the UK to accelerate the rollout of vaccines, using their space, capacity and people as much as possible. In the meantime, a fit-for-purpose Test, Trace and Isolate system remains critical to keep the economy moving once the current lockdown ends.
The most recent BCC Quarterly Economic Survey of more than 6,000 firms, across all sectors, found that all key economic indicators remain well below pre-crisis levels and four in ten firms have seen their cash flow drop. Government data also shows UK economic output remains almost 8 per cent below the pre-pandemic levels seen in February 2020.
Adam Marshall, Director General of the BCC, said:
“We have written to the Chancellor to highlight the desperate situation facing thousands of businesses all across the UK.
“The damage inflicted by the pandemic is widespread. It goes far beyond the very visible casualties hit by repeated stop-start lockdowns.
“The support schemes the Government has introduced so far have saved many firms and jobs, but they have not gone far enough to help many survive a tough start to 2021. The drip-feed approach to business support measures has meant many firms simply cannot plan for the future.
“We are urging the Government to urgently adopt a package of measures that covers the whole of 2021, and that takes away the cliff-edges firms face in a few weeks’ time when reliefs, forbearance and furlough are set to end. Many companies simply can’t wait until the March budget. Action is needed now.”
Paul Britton, CEO of the Thames Valley Chamber of Commerce said:
“Thames Valley business large and small are calling for an immediate response with a longer term approach by Government to help prepare and plan for the future.
“The impact of restrictions are far wider than those businesses forced to close by new restrictions, and without an enhanced support package the resilience that has been shown by many risks being overshadowed by further job losses and business failures.”