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Gloucestershire Business News

Chancellor urged to do more after fresh support

Chancellor Rishi Sunak has been urged to beware a "spring cliff edge" after announcing fresh financial support for businesses following introduction of the latest coronavirus lockdown restrictions.

The latest package, which includes one-off grants of up to £9,000 for retail, hospitality and leisure businesses hit by the latest restrictions, has been described as just a "sticking plaster" and "a lifeline" by trade bodies.

And business leaders from across a variety of sectors have called on the Chancellor to take further measures to support businesses.

Chancellor announces grants to help businesses through lockdown collated reactions from a range of business organisations.

Kate Nicholls, chief executive, UKHospitality
"The Chancellor has rightly recognised the costs imposed on hospitality businesses by enforced closures and the need for additional support.

"It is also encouraging that the discretionary grants address the suffering in the supply chains upon which our sector is reliant.

"While this announcement is most welcome, this is only a sticking plaster for immediate ills - it is not enough to even cover the costs of many businesses and certainly will not underpin longer-term business viability for our sector.

"To address the inevitable and existential challenges that hospitality faces, we need confirmation of extensions to the business rates holiday and of the five per cent VAT rate.

"On its own, today's support is not enough. Businesses need a longer-term economic plan and it would befit the crisis that we face if the Chancellor brought forward his Budget to make the announcements necessary to reassure businesses and allow them to plan their survival.

"Commercial certainty cannot come soon enough and only the Chancellor can deliver it.

"The hospitality sector can assist in the rapid roll out of the vaccine and we are keen to repay the support shown to us.

"Our sector is sitting on well-ventilated, Covid-secure spaces such as hotels, conference centres, pubs and restaurants which can be used and businesses are already coming forward to offer locations to expedite a mass vaccination programme."

Emma McClarkin, chief executive, British Beer & Pub Association

"We welcome this much-needed support from the Chancellor, worth £277million to UK pubs. It is the lifeline we have been campaigning for to save our pubs and help them survive through to the spring.

"Without this support, pubs across England were at real risk of being lost for good at the beginning of this year.

"We had been anticipating permanent closures in the very short term without it.

"Given that the future of so many pubs hang by a thread, it is essential the Government delivers grants to pub businesses immediately. If the grants take weeks or months to get to the pubs they are meant for, it will be too late.

"The grants will mean many pubs may now be able make it through until spring.

"The Government now must also provide the same levels of support to brewers who have suffered months of closure of a major trading channel in pubs, but are not eligible for the support announced today.

"In the coming months, the Government must also share how it will help our sector to play a leading role in the economic recovery when it can reopen, by extending stimulus support such as the Business Rates holiday and VAT cut, along with further initiatives including a beer duty cut.

"Ultimately we know that pubs will eventually be a part of the way out of this crisis and back to normality.

"Some are even offering themselves up as vaccine hubs, which drives home the fact losing them would do untold harm to our communities."

Mike Cherry, national chairman, Federation of Small Businesses

"While this additional financial support will be a lifeline to 600,000 businesses, there is a need for a plan that matches the scale of the economic damage we are seeing.

"For many it just won't be enough for businesses who are already under the cosh and on the brink.

"These funds come after a disappointing festive period and are followed by a last-minute lockdown and do not go far enough to match the scale of the crisis that small firms are facing.

"There remains too many groups who need more support to weather this storm such as the newly self-employed, those in supply chains and company directors. 

"We continue to call on the government to create a Directors Income Support Scheme, mirroring the Self Employed Support Scheme, in the form of a taxable grant for directors of limited companies calculated at 80% of three months average monthly trading profits, paid out in a single instalment and capped at £7,500.

"We also need to see the Government make clear its plans for more finance capabilities made available to those who have used their allocations through Bounce Bank Loans ,as well as extending the period before repayments begin.

"This lockdown is expected to last for some time, even when restrictions ease, many small firms will be unable to function at 100 per cent, if at all. Which is why the Government should create a Spring Economy Plan to help firms get through to drive a vaccine-enabled recovery.

"After clawing their way through 2020, the start of the new year looks set to be an even worse one for many. Small businesses are the backbone of our economy, and it is absolutely vital we support them in every way possible until the crisis finally begins to ease."

Adam Marshall, director general, British Chambers of Commerce

"While this immediate cashflow support for business is welcome, it is not going to be enough to save many firms.

"We need to see a clear support package for the whole of 2021, not just another incremental intervention.

"The Government must move away from this drip-feed approach and set out a long-term plan that allows all businesses of all shapes and sizes to plan, and ultimately survive.

"Many smaller firms won't qualify for the full headline amounts set out in the Chancellor's statement and will be left struggling to see how this new top-up grant will help them out of their cashflow problems.

"Support must be sufficient to cover not just those on the front line of retail, hospitality and leisure, but also firms in supply chains and wider business communities who are also feeling the devastating impacts of these restrictions."

Roger Barker, director of policy, Institute of Directors
"This new grant package is welcome and will go some way to reassuring the worst affected businesses.

"We are particularly pleased the Treasury has taken on board our recommendation to increase the discretionary local authority grant fund.

"This policy has helped to reach those who haven't been able to access other support. The Government should be prepared to top up the fund if necessary.

"The Chancellor must remain wary of a spring cliff edge in business support as the furlough scheme and other support measures unwind.

"Businesses will also be keen for the Government to continue setting out its plans for the vaccine roll-out, to support their planning.

"The path of the virus is extremely uncertain, and Government must be agile in its response to prevent lasting economic damage."

Rain Newton-Smith, chief economist, CBI
"The Chancellor has once again moved swiftly to support businesses as circumstances change. It is sorely needed.

"More direct grants will provide some relief to eligible companies' cashflow.

"Yet with businesses facing a third lockdown, there are other steps that can help provide a bridge to the all-important economic recovery, particularly those affected through supply chains.

"For some, demand has once again evaporated overnight and in northern England some firms have been labouring under stop-start orders for months already.

"Therefore extending the job retention scheme to end of the second quarter would provide firms with a clear line of sight, aiding planning and investment.

"And removing the business rate relief cliff edge in April will provide much-needed breathing space, as will re-examining the case for VAT deferrals.

"With the vaccine rollout underway and increasing mass rapid testing, there really is a brighter future within reach.

"Maintaining steadfast support for firms during this painful period will help ensure the recovery is delayed for as short a time as possible."

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