COVID-19 Update – Heading for the Budget
As we all seemed to have ‘settled’ into Lockdown #3, it has been a few weeks since my last COVID-19 update. You’d have to have been on another planet, though, to have missed the Prime Minister’s address last night setting out his roadmap to recovery, and so, following this, I thought I should touch base once again.
So, from this roadmap we now have a good indication of when things may open and this has to be positive news, allowing us all to start planning for the resumption of our businesses and, of course, our own personal lives.
What was missing last night though, were the support measures that the government will introduce or continue to leave in place as we embark on this road to recovery.
It is obvious that businesses that have been struggling through aren’t going to be rubbing their hands with glee and counting their profits at the end of week one, month one or even, in many cases, year one. It is going to be a long, hard, slow and, hopefully, steady recovery for so many of us and thus it is vital that the government recognises this in the support packages that I hope will be announced when the chancellor reveals the detail of his spring budget next week (Wednesday 3 March).
I hope that he will announce a number of recovery support measures for the business sector, including the continuation of the local support grants scheme. For me, furlough absolutely has to be extended well beyond its current end date of 30 April and I would hope that we will see the 80% flexible furlough retained for a number of months before moving to gradually reduced levels – 70%, 60%, 50% – similar to how this was envisaged last year before we headed into the tiered approach and then the second and third lockdowns.
An extension to furlough will be critical as I am sure that there will be many businesses that will not be able to bring back all of their furloughed employees immediately and I also fear that we will see further redundancies as businesses evaluate their respective paths to recovery.
Those businesses that took out Bounce Back Loans received positive news recently in that these loans can now be paid back over 10 years instead of 6, and payment holidays can be taken by businesses.
Another positive is that businesses that had struggled to claim on their business interruption insurance may now have that opportunity following the recent judgement by the Supreme Court. If you want to see whether you might be able to claim, take a look at the FCA’s on-line policy checker:
There are other things that we will need to keep an eye on in next week’s budget statement that could have a negative impact and counter other possible support measures – things such as VAT, National Insurance and Corporation Tax. Let’s keep our fingers crossed and hope that the government does not undermine the positive support measures that they have put in place for businesses over the past 11 months.
As always, give me a call should you require any further information or if you need advice on any employment matters.