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Covid-19 Business Support Update II

Following on the Monday post about the impact of the unfolding Coronavirus situation on business, here is the latest update from the UK Government.

At a briefing from Downing Street yesterday evening the Prime Minister and Chancellor of the Exchequer announced further measures to respond to the Coronavirus health/economic emergency.

Rishi Sunak confirmed a number of additional financial/business support measures, including:

  • Government-backed loans totalling £330bn of guarantees (15% of GDP) consisting of Government-backed loan or credit on attractive terms – to be extended if necessary to provide as much capacity as required.
  • A scheme to support liquidity through larger firms via a new lending facility with Bank of England – low cost, easily accessible
  • An extension to the already-announced business interruption loan scheme – increasing from £1.2m up to £5m loans with no interest for the first 6 months
  • Both schemes would be up and running by the start of next week
  • The Chancellor to seek a new legal power - through the COVID Bill – to offer further financial support is necessary
  • ransport/Treasury currently discussing specific support for airlines and airports to be announced over next days
  • Cabinet colleagues to convene meetings with most affected business sectors to discuss regulatory forbearance and other support
  • Hospitality/leisure businesses with an insurance policy that covers pandemics – today’s announcement will allow business to make an insurance claim against their policy
  • If no insurance, business in retail, hospitality and leisure sectors can claim an additional cash grant of up to £25k per business to bridge through the period
  • Extending business rates holiday to all business in hospitality/retail sectors irrespective of rateable value – shop, pub cinema, restaurant etc – will pay no business rates for 12 months
  • £3k cash grant for 7000 smallest businesses – will be increased to £10k – on top of unlimited lending capacity
  • £3.5bn additional funding for devolved governments
  • To support families, mortgage lenders will offer a 3 month mortgage holiday

Further measures to support the financial security of individuals currently being discussed with trade unions and business groups – expect to announce new forms of employment support to protect jobs and incomes

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