CBI says Treasury must not wait until the budget of March to provide further assistance
The CBI’s company lobby has invited the government to come up with a robust support plan to help businesses overcome the recent lockdown of Covid 19.
If another lockdown is happening in England and Scotland, the government needs to step in, business groups say, with more support steps.
Tony Danker, the director general of the CBI, said that the government could not wait until the March budget to announce further business support and that in the coming days he expected the Treasury and the Department of Business to do so.
“Make no mistake, the economic impact of these new restrictions is very significant,” he told BBC Radio 4’s Today show.
Demand is dropping again in the economy, high streets and physical shops are losing footfall, recovery is on hold, which is a huge blow to trade and investment in industry. We’ve seen closures before, we know their effect, and so wider constraints need a broader economic response.
He said it is important to ensure that companies have the cash flow to get through the winter, pointing to potential steps of sales tax deferrals, other tax breaks and more generous grants. Over Christmas, the hospitality industry has already lost its “golden quarter” and the current quarter is critical for gym operators, he said.
The pub industry said the current amount of grants were not enough to cover operating expenses such as rent, with pubs closing around the U.K. and a ban on the selling of takeaway alcohol in England.
The Pubs Movement called for an increase of at least £ 1,000 a week in closure grants, a statutory rental code to stop unfair rentals, a holiday business rate in 2021-22, a 5 percent VAT on all pub sales, not just food sales sites, and a decrease in business rates for small breweries and other suppliers.
Campaign for Pubs director Greg Mulholland said, “Without urgent, adequate support, many pubs – including pubs that have survived centuries and two world wars – will be lost.”
Among other things, the Small Business Federation called for a second round of cash grants, support to younger independents, and increased repayment terms and caps on bounce-back loans.
Danker said the government needs to examine and close any holes in current supply chain support, and businesses need to be confident that there will be support “as long as the Covid 19 restrictions are in place” so that they can prepare accordingly. The government’s job retention policy ends on April 30, and after that, unemployment is projected to increase sharply.
“On vaccines, we’re close to the end, but we have to finish the job,” Danker said. “It’s always been about protecting the viability of companies, it’s always been about building a bridge to recovery, we’re almost on the other side and we need to put the last pieces in place.”