A range of emergency financial measures has been announced to help businesses survive as the coronavirus outbreak worsens.
The Chancellor of the Exchequer, Rishi Sunak, has announced further government support to protect the country's businesses against the economic impacts caused by the coronavirus including unlimited loans and guarantees to support firms and help them manage cash flows through this period. The Chancellor will make available an initial £330 billion of guarantees – equivalent to 15% of UK GDP.
At last week's Budget, the Chancellor provided £30 billion of support to the economy to deal with the crisis by investing in public services and providing the business community with tax reliefs and loans.
Owing to the fast-changing situation, further actions have now been outlined to help businesses through this uncertain time. To ensure that businesses have access to the funds they need, the Government is providing:
- Support for liquidity amongst large firms, with a new scheme being launched by the Bank of England to help them bridge coronavirus disruption to their cash flows, through loans.
- Increasing the amount businesses can borrow through the Coronavirus Business Interruption Loan Scheme from £1.2 million to £5 million, and ensuring businesses can access the first six months of that finance interest-free, as the Government will cover the first six months of interest payments.
Both of the above mentioned schemes will be up-and-running by the start of next week.
The Chancellor also announced that £20 billion of business rates support and grant funding will be provided to help the most-affected firms manage their cash flow through this period by:
- Giving all retail, hospitality and leisure businesses in England a 100% business rates holiday for the next 12 months.
- Increasing cash grants to small businesses eligible for Small Business Rate Relief from £3,000 to £10,000.
- Providing further £25,000 grants to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value over £15,000 and below £51,000.
The Chancellor confirmed that his recent actions mean that over £3.5 billion in additional funding will be provided to the devolved administrations to support businesses in Scotland, Wales and Northern Ireland.
Furthermore, the Government will be including new legal powers in the Covid Bill, enabling it to offer whatever further financial support it deems necessary to assist businesses.