Chancellor Rishi Sunak has just revealed a further £330bn guaranteed government loans for British businesses affected by the coronavirus pandemic, adding to the £30bn package of support for people and businesses announced in last week’s budget.
“Any business which needs access to cash to pay their rent, salaries, suppliers or purchase stock, will be able to access a government-backed loan on attractive terms,” the chancellor said in today’s government press conference, the daily briefing which has been instituted due to the international coronavirus crisis.
“And if demand is greater than the initial £330bn I am making available today, I will go further and provide as much capacity as required.”
He detailed that the support will be delivered through two main schemes. For larger firms, a lending facility has been agreed with the governor of the Bank of England to provide what Sunak described as “low cost, easily accessible commercial paper”.
While for small and medium sized businesses, the government is extending the business interruption loan scheme previously announced in the budget to prove loans of up to £5m, increased from £1.2m, with no interest due for the first 6 months.
The chancellor revealed that both schemes would be established by the start of next week.
Catering equipment dealers’ worries will hopefully be slightly eased by new measures announced to help the hospitality industry too.
For those sector businesses who have an insurance policy that covers pandemics, Sunak believes that the government’s action is sufficient and will allow businesses to make an insurance claim against their policies.
However, for hospitality businesses which don’t have insurance, the chancellor detailed: “I announced last week that for businesses in the retail, hospitality and leisure sectors with a rateable value of less than £51,000, they will pay no business rates this year.
“Today I can go further and provide those businesses in those sectors with an additional cash grant of up to £25,000 per business to help bridge them through this period.
“Additionally, I am also extending the business rates holiday in those sectors to all businesses, irrespective of their rateable value. That means every single shop, pub, theatre, music venue and restaurant in the retail and hospitality sector will pay no business rates whatsoever for 12 months. And if they have a rateable value of less than £51,000 they can also get a cash grant as well.”
Sunak also made it clear that the government had taken legal steps to enable it to put further measures in place, should those announced today not prove sufficient to stabilise the economy.