"Woefully inadequate": The business community reacts to the Chancellor's winter economy plan
Leaders from across the business community have reacted to this afternoon’s Job Support Scheme announcement.
The new measures announced this afternoon will see workers paid two thirds of their regular wages, provided that they work at least one third of their regular hours.
The announcement also included news that the current self-employment scheme (SEISS) will be extended, and that the hospitality and tourism sectors will see a 15 per cent cut in VAT.
While figures in the community have largely welcomed the announcement, some have said that more support is needed, calling the provisions “woefully inadequate”.
**Andy Chamberlain, IPSE (the Association of Independent Professionals and the Self-Employed) **
“The support for the self-employed announced today is woefully inadequate. Although it is right for the Chancellor to extend SEISS, the support announced today still excludes one in three self-employed people.
“Limited company freelancers and the newly self-employed almost entirely missed out on support in the last lockdown and have faced bleak months of financial devastation. Now they face a dark winter ahead unless the government does more for them.”
Musab Hemsi, LexLeyton
“Sadly, the maths simply does not support 6 months of sustained employment. Without a clearer trajectory around industry-specific and overall business & economic recovery, many businesses will be left in the dark.
“Unfortunately the businesses within sectors such as hospitality, leisure and events will not be saved by these measures. Workers who find themselves within industries where cashflow remains hampered or precluded by government measures are likely to lose their jobs.
“Many features of the scheme also require a great deal of clarity before it goes live. At present we do not know which companies qualify and the meaning of ‘viable jobs’ and the qualifying criteria for a ‘large employer’.
“Amongst other sectors, flexibility is going to be central to the success of this scheme. A great deal can happen over the course of six months, and businesses who are unable to plan ahead will need the scheme to be flexible in order to survive.
“We strongly encourage the government to give employers room to manoeuvre and utilise the scheme to best suit their interests.”
Dr Joe Marshall, NCUB
“Whilst we welcome plans outlined today in the Job Support Scheme, we are disappointed that the Chancellor did not announce more to help young people take steps into the labour market.
“Covid-19 has hit young people the hardest and the government has today missed an opportunity to offer much needed support.
“Without assistance, young people will continue to face unemployment, and employers will lose out on the innovative, talented workforce they crucially need to recover post Covid.
“To support those businesses that are continuing to hire apprenticeships at this unprecedented time of uncertainty, the government should introduce a 50 per cent wage subsidy for people under the age of 25 undertaking an apprenticeship or work placement.
“Urgent action needs to be taken to reverse this worrying trend, and to help the young people who want to play a crucial role in our economic recovery.”
Luke Davis, IW Capital
“These measures will be a relief to many businesses and especially small businesses that have struggled in the past six months to continue trading. The last thing any business founder wants to do is close their doors or make workers redundant and so continued support will undoubtedly be welcomed.
“There is, however, another way to combat unemployment that has so far been largely glossed over.
“For those businesses who have pivoted or adapted quickly, or that offer services that cater to our new way of living and working there are significant opportunities for growth. This more often than not leads to more employment, especially in the SME sector.
“Making growth investment more easily available to SMEs that are looking to grow should be a priority. “
Mike Cherry, Federation of Small Businesses (FSB)
“There are many measures to welcome here that will make a real difference. It’s particularly encouraging to see that all small businesses will be able to access the new job support scheme without facing excessive paperwork, with a guarantee of help for the next six months.
“News of the ‘Pay as You Grow’ approach will mean relief for hundreds of thousands of firms, giving them the confidence to invest and hire today rather than tomorrow, providing a crucial option to suspend repayments for six months.
“We are concerned that the Chancellor had nothing to say today on support for those who were left out of the first round of support measures, not least the newly self-employed and company directors.
“The government urgently needs to come forward with an emergency relief package for these groups which have dutifully paid their taxes and deserve help too.
“Today’s statement is a very welcome and significant step forward, but there must be more to come.”
Jonathan Walker, North East England Chamber of Commerce
“With the furlough scheme due to end next month it was clear we needed further measures to prevent a huge spike in unemployment.
“The government’s new Job Support Scheme shows they have recognised the importance of this issue and the scheme should help to preserve at least some jobs that would have otherwise been at risk.
“However, we are concerned the measures won’t go far enough for many jobs that are vulnerable and impacted by ongoing public health restrictions.
“The need to help businesses in sectors such as hospitality and culture has not gone away. In addition, we must support those people who will still unfortunately lose their jobs to help them retrain or potentially start their own business.
“We have also raised the issue of cash flow to protect the viability of vulnerable companies.
“Today’s announcement on VAT and state-backed loans demonstrate clearly government recognises this. We realise that the measures will not be right for every business and that further economic support will be needed to prevent insolvencies.
“With reports of a delay to the budget we are hugely concerned that this could also delay the levelling up the North East has been promised.
“We know this virus and the recession will affect our region more profoundly than many other parts of the country.
“With every week that passes the need to level up becomes more important. Delays will only acerbate the inequalities we see already.”
** Andrew Harding, CGMA (The Chartered Institute of Management Accountants)**
“The Chancellor’s statement earlier is to be welcomed on many fronts but has not looked far enough ahead.
“The statement has missed an immediate opportunity to tackle the long-term challenges faced by the UK economy, which this crisis has only exacerbated (e.g. UK’s faltering productivity, widening skills gap and failing social mobility).
“This will likely prove detrimental for businesses, people and the economy as we seek to recover from the COVID shock.
“Over the coming weeks, we look forward to the government putting a greater focus on key areas such as providing new training opportunities to reskill the workforce and for those who have lost their jobs to enhance recovery and improve productivity.
“Additionally it is essential that the government provides businesses with greater certainty in areas under its control such as taxation, regulation and trade to help them make better investment decisions for the future.”
Michael Kill, NTIA
“We welcome the Chancellor’s announcement of the new Jobs Support Scheme and the extension of the self-employed scheme, which we very much hope will stave off the feared cliff edge of the Job Retention Scheme for many businesses.
“We are relieved he has seen the plight facing businesses, employees and the self-employed across the UK and thrown a much needed life-line to hundreds of thousands of workers in the night-time economy alone who were terrified of losing their livelihoods.
“However, we are seeking more clarity about what this announcement means for the majority of businesses in the night-time economy who do not know when, or if, they will be able to reopen their doors.
“These businesses cannot be allowed to collapse as the diversity and creativity of the UK’s night-time economy will die with them.
“We are also very concerned that the extension of business support loans will result in more painful debt for those already overburdened financially, many of whom are languishing in up to three quarters of commercial rent debt with no certainty on when this will be due.
“More support will be needed. The majority of our sector is still unable to even open and trade. Night-time economy businesses have been unfairly targeted by the new 10pm curfew, which we believe has no scientific basis and will prevent businesses from rebuilding the necessary revenue to stay afloat.
“The government must rethink this curfew and consider further sector-specific support for our industry if it wants to save Britain’s most loved cultural institutions.”
Dan Jarvis, Mayor of the Sheffield City Region
“The Chancellor is right to take action on jobs and businesses facing a cliff edge at the end of furlough. However, today’s announcement only offered temporary respite for existing jobs and businesses at risk, and there was nothing to support industries who remain closed thanks to Covid.
“What we need to see is a long-term plan for renewal, investing in regions like South Yorkshire and unleash our potential and create a new generation of jobs and prosperity.
“We need the Chancellor to support the renewal of our economy, not just its rescue. That means backing our ambitious and wide-ranging Renewal Action Plan in the Comprehensive Spending Review.
“The Chancellor shouldn’t risk trying to drive the recovery from Westminster, when we know mayors and regional leaders are best placed to deliver a jobs-led recovery and level up the economy.
“That means giving us the resources and powers needed to get on with the job and build a stronger, greener and fairer South Yorkshire.”
Peter Heath, Plasa
“The live events industry welcomes the announcement of Sunak’s new job support scheme, which will provide some form of relief for companies in the sector.
“Yet, with the increased restrictions introduced by government earlier this week, it’s looking unlikely that the sector will be able to return to work in a way that is financially viable over the next six months.
“There’s simply no work to return to, with demand drying up in line with social distancing measures.
“As a result, the majority of businesses in our sector will not be able to generate sufficient revenue to support their contribution towards employees’ salaries, nor will they be able to contract the huge self-employed community the events industry has become so dependent upon.”
Ravi Anand, ThinCats
“These are welcome changes to the government loan schemes as the Chancellor has listened to what lenders have been requesting.
“The extension of the application deadline, although modest, will enable more businesses to access funding.
“The flexibility on payments and terms will help businesses manage their costs and give lenders more confidence to support companies out of the pandemic, enabling long term and sustainable growth.
“Additionally, the new scheme next year should give the wider business community time to plan with greater confidence knowing that funding should be available.”
Andrew Hunter, Adzuna
“The Chancellor is throwing the country a lifeline to preserve jobs and keep small businesses and vulnerable sectors such as hospitality & tourism afloat.
“The loss of well over 700,000 jobs since the start of the pandemic has been tragic, and these measures will go a long way to keep a lid on skyrocketing unemployment across Britain.
“With these measures in place, the key now is going to be job creation in growth industries and addressing how the government can attack on all fronts to create new opportunities.
“It’s important to remember that we haven’t shut down the whole economy and in the wake of huge employer uncertainty, we need to boost labour demand and hiring confidence to get Britain’s job market back on its feet.”
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