Chancellor Rishi Sunak gives his latest COVID-19 response

Johnson Reed
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Chancellor Rishi Sunak gave his latest COVID-19 response yesterday with his first update since the budget.

The first Government response since the Budget, with commitment to supporting small and medium businesses.

He stated “I want to reassure every British citizen, this government will give you all the tools you need to get through this.”

“We will support jobs, we will support incomes, we will support businesses, and we will help you protect your loved ones. We will do whatever it takes.”

Key Points:

  • First, the government will stand behind businesses small and large
  • Unprecedented package of government-backed and guaranteed loans to support businesses to get through this
  • An initial £330 billion of guarantees – equivalent to 15% of our GDP
  • That means any business who needs access to cash to pay their rent, the salaries, suppliers, or purchase stock, will be able to access a government-backed loan, on attractive terms

That support will be delivered through two main schemes:

  • New lending facility with the Governor of the Bank of England to provide low cost, easily accessible commercial paper
  • Business Interruption Loan Scheme announced at the Budget last week, so that rather than loans of £1.2 million, it will now provide loans of up to £5 million, with no interest due for the first six months

Both of these schemes will start 23rd March

  • For those businesses which do have a policy that covers pandemics, the government’s action is sufficient and will allow businesses to make an insurance claim against their policy
  • Announced last week that for businesses in the retail, hospitality and leisure sectors, with a rateable value of less than £51,000, they will pay no business rates this year. businesses with an additional cash grant of up to £25,000 per business – to help bridge through this period
  • Extending the business rates holiday to all businesses in those sectors, irrespective of their rateable value
  • £10,000 cash grants to the 700,000 of our smallest businesses

Johnson Reed will continue to monitor the situation and keep businesses updated