The Chancellor has announced plans for £330 billion worth of government-backed and guaranteed loans to support small businesses impacted by the outbreak of Coronavirus.
Rishi Sunak said the fund would be available to any business struggling to pay rent, or salaries or purchase stock. Repeating that the government will do ‘whatever it takes’ to help the country’s businesses, the Chancellor said the fund would be increased if demand is greater.
He described the measures announced today (Tuesday) as on an “unimaginable scale a few weeks ago”.
There were also expansions to measures announced in last week’s Budget Statement. Having already removed business rates for businesses with a rateable value of up to £51,000, the Chancellor announced that those businesses will also be able to access a £25,000 grant. In addition, businesses in the much-discussed hospitality industries will pay no business rates for 12 months regardless of their rateable value.
The UK government is also pledging an extra £3.5 billion of funding for devolved governments in Scotland, Wales and Northern Ireland to help support businesses.
For somewhat larger businesses, the Chancellor said talks with the Bank of England had resulted in measures to free up liquidity. And the £1.5 million loans for medium businesses announced in the Budget has been increased to £5 million. There was limited detail on these steps, but Mr Sunak said they would be up and running by the start of next work.
Following a host of airlines cutting flights, cutting staff and delivering stark warnings about their ability to continue trading in the near future, the Chancellor said the government is in talks over a potential support package for airports and airlines.
To individuals, the Chancellor stressed that the government would do whatever is necessary to ensure both their physical and financial health are looked after. Mr Sunak said an agreement has been struck with mortgage lenders to provide a three month ‘payment holiday’ to those whose finances have been affected. There was no mention of rent payments, but he did say the government would “go much further in the coming days”.