Originally written by Timothy Adler on Small Business
Rishi Sunak has extended the UK’s £68bn coronavirus emergency financial support including the Bounce Back Loan Scheme until the end of March.
The Bounce Back Loan Scheme, the Coronavirus Business Interruption Loan Scheme and the Coronavirus Large Business Interruption Loan Scheme had all been due to close at the end of January.
With swathes of southern England joining the north in Tier 3 lockdown, effectively shutting down pubs and restaurants, the Treasury needed to support small businesses which face months with much-reduced or no revenues.
The Treasury said: “We are extending the schemes now, ahead of Christmas and further into the new year, to ensure that businesses can continue to access the support they need to grow and recover.”
The loan schemes provide guarantees for banks to lend quickly and cheaply to struggling businesses during the pandemic. The Bounce Back Loan Scheme (BBLS) carries a full guarantee from the government for up to £50,000, while the others have a guarantee which covers the banks for about 80 per cent of the value of the loan.
However, the government itself has admitted that 60 per cent of Bounce Back Loans will never be repaid, leaving the taxpayer facing a
Tag Archive for Coronavirus Job Retention Scheme
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Bounce Back Loan Scheme extended until the end of March
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Rishi Sunak has extended the UK’s £68bn coronavirus emergency financial support including the Bounce Back Loan Scheme until the end of March.
The Bounce Back Loan Scheme, the Coronavirus Business Interruption Loan Scheme and the Coronavirus Large Business Interruption Loan Scheme had all been due to close at the end of January.
With swathes of southern England joining the north in Tier 3 lockdown, effectively shutting down pubs and restaurants, the Treasury needed to support small businesses which face months with much-reduced or no revenues.
The Treasury said: “We are extending the schemes now, ahead of Christmas and further into the new year, to ensure that businesses can continue to access the support they need to grow and recover.”
The loan schemes provide guarantees for banks to lend quickly and cheaply to struggling businesses during the pandemic. The Bounce Back Loan Scheme (BBLS) carries a full guarantee from the government for up to £50,000, while the others have a guarantee which covers the banks for about 80 per cent of the value of the loan.
However, the government itself has admitted that 60 per cent of Bounce Back Loans will never be repaid, leaving the taxpayer facing a
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Government makes further changes to Coronavirus Job Retention Scheme
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
UPDATED: The government has announced further changes to the Coronavirus Job Retention Scheme (CJRS).
The scheme, also known as furlough, has been extended until the end of March, with furloughed employees being paid 80 per cent of their wages until January 2021. It will be reviewed at this point.
What happens when furlough ends?
Rishi Sunak’s previous plan was to wind up the furlough scheme on October 31. After that, staff returning to work would’ve been moved onto the less generous Job Support Scheme (JSS). JSS has been put on hold.
But now that the furlough scheme has been extended until the end of March, furloughed employees will remain on the Job Retention Scheme, with the government paying up to 80 per cent of staff wages (capped at £2,500 a month). Anyone made redundant after September 23 can be rehired and put back on furlough.
Can you work while on furlough?
No, employees cannot take on any work for, or on behalf of, their employer while they’re on furlough. Nor can they take on any work linked or associated with their employer. This includes providing services (that includes attending meetings) and generating revenue for the business.
Employees can undertake study and
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How the 100% Local Furlough Scheme grant will work for your small business
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
UPDATED: Chancellor Rishi Sunak is due to announce a further Local Furlough Scheme for businesses caught out by hard local lockdowns.
The government will cover 100 per cent of staff wages for small businesses ordered to close in areas in hardest-hit regions.
Larger firms blindsided by the highest lockdown level will have between 60 per cent and 80 per cent of staff wages covered.
Manchester, Liverpool and other areas of the North are expected to go into harder lockdown early next week, once the government launches its new traffic-light system for dealing with coronavirus outbreaks.
>See also: Rishi Sunak plans grants for small businesses hit by hard lockdown
London is expected to follow shortly, following a warning from Mayor Sadiq Khan.
Meanwhile help for hospitality businesses forced to close in Scotland will get their own £40m support package.
The Local Furlough Scheme is far more generous than the Jobs Support Scheme, announced last month, as the successor to the Coronavirus Job Retention Scheme, which ends on October 31.
>See also: Local lockdowns only make the problem of late payment worse
Every business in the UK is eligible for the Jobs Support Scheme from November, which covers one third of the wages for
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Jobs Support Scheme what it means for your small business
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
UPDATED: The government will pay one-third of the wages of workers on the days they do not work through its new Jobs Support Scheme. Employers will pay the other third and the employee will take a one-third paycut on days not worked.
In effect, this means the government has only committed to covering one-fifth of the wages of small business workers who are working one-third of their normal hours. Small business owners will be expected to cover 55 per cent of wage costs overall on a five-day week, the government 22 per cent — which means the small business employee faces a 23 per cent overall from November 1.
The question remains whether small businesses will be prepared to dig into their pockets to keep workers “fully employed” – even if they are not at work for the majority of the time under the Jobs Support Scheme – or whether it’s easier just to put them on reduced hours.
Accountancy firm Kreston Reeves pointed out that a flaw in the scheme that would leave small businesses that choose to keep three part-time employees working one third of their normal hours facing significantly higher costs than if
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Jobs Support Scheme what it means for your small business
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
UPDATED: The government will pay one-third of the wages of small business workers on reduced hours through its new Jobs Support Scheme.
Rishi Sunak announced the six-month Jobs Support Scheme to follow on from the coronavirus furlough scheme and begins on November 1.
Employees must work at least one third of their normal hours and be paid as normal. The government will then top up, covering one-third of pay lost by reducing hours, the business owner will cover another third and the employee will take a 33 per cent pay cut.
The level of government grant will be calculated based on an employee’s usual salary, capped at £697.92 per month.
>See also: Rishi Sunak eyes subsidising wages of part-time workers
Only full-time staff will be eligible for the Jobs Support Scheme.
The Jobs Support Scheme is designed to support full-time staff where there is not enough demand to justify them working a five-day week.
Mr Sunak told MPs he would strike the finely judged balance between managing the virus and protecting “the jobs and livelihoods” of people across the country.
The chancellor previously made clear he did not want to extend the £39bn furlough scheme to keep people in so-called “zombie
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MPs back call for ‘targeted’ extension of furlough scheme
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
MPs have urged Rishi Sunak to extend the taxpayer-funded furlough scheme businesses with a chance of surviving the coronavirus crisis.
The Chancellor should “show flexibility” and target companies that are still viable when the existing furlough scheme ends in October, members of the Treasury select committee said.
The committee said the Chancellor should “carefully consider” whether a targeted extension was needed for the furlough scheme, which has protected 9.6m jobs to date at a cost of £35bn. The scheme will be wound up at the end of October. Some 11 per cent of the British workforce were on partial or full furlough in mid-August, according to a survey published on Thursday by the Office for National Statistics.
>See also: Where to find your £1,000 small business lockdown grant
The cross-party select committee said in its report on the economic impact of the COVID-19 pandemic, published today, that a large proportion of businesses in the sectors most affected by social distancing might have a long-term future.
“The key will be assisting those businesses who, with additional support, can come through the crisis as sustainable enterprises, rather than focusing on those that will unfortunately just not be viable in the
Hot Business News Today
MPs back call for ‘targeted’ extension of furlough scheme
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
MPs have urged Rishi Sunak to extend the taxpayer-funded furlough scheme businesses with a chance of surviving the coronavirus crisis.
The Chancellor should “show flexibility” and target companies that are still viable when the existing furlough scheme ends in October, members of the Treasury select committee said.
The committee said the Chancellor should “carefully consider” whether a targeted extension was needed for the furlough scheme, which has protected 9.6m jobs to date at a cost of £35bn. The scheme will be wound up at the end of October. Some 11 per cent of the British workforce were on partial or full furlough in mid-August, according to a survey published on Thursday by the Office for National Statistics.
>See also: Where to find your £1,000 small business lockdown grant
The cross-party select committee said in its report on the economic impact of the COVID-19 pandemic, published today, that a large proportion of businesses in the sectors most affected by social distancing might have a long-term future.
“The key will be assisting those businesses who, with additional support, can come through the crisis as sustainable enterprises, rather than focusing on those that will unfortunately just not be viable in the
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Bank of England eyes Working Capital Jobs Retention Scheme
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
EXCLUSIVE: The Bank of England is eyeing payroll finance technology as a possible successor to the furlough scheme, which ends in October.
The coronavirus jobs retention scheme will cost the government £60bn in total but industry is braced for millions being made redundant when the scheme closes on October 31.
PwC estimates that without any extension one in five of those now on furlough will be made redundant. The Bank of England itself estimates that unemployment will almost double to 7.5 per cent by the end of the year, as things stand.
>See also: What do SMEs think is the best business bank account? – survey
Called the Working Capital Jobs Retention Scheme, the ground-breaking payroll technology is the brainchild of David Brown, fintech entrepreneur and chief executive of Hi55. The WCJRS would enable the banks to fund up at least £4,300 per employee risk free, throwing businesses another working capital lifebelt.
This is because EU law stipulates that all European governments must still cover payroll for a fixed period should their employer go bust. The Employment Rights Act has been law since 1996.
In the UK the government must step in and pay each employee £538 for each
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Sunak decides whether to subsidise small businesses hiring young people
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Rishi Sunak, the chancellor, is deciding whether to subsidise small businesses giving young people aged below 25 full-time jobs.
Such a scheme, which could be announced next week when the chancellor unveils his plans to get the UK economy moving again, would be similar to the future jobs fund which ran between 2009 and 2010.
The commitment to subsidise young people working for small businesses would be part of an “opportunity guarantee” to ensure that every young person has a chance of an apprenticeship or an in-work placement.
>See also: How to reopen your restaurant, pub or hotel post-lockdown
Young people aged below 25 are the most vulnerable when it comes to the jobs market post pandemic, with the Bank of England estimating 9 per cent unemployment as the country struggles back onto its feet. According to a Be the Business survey published this week, businesses expect to lay off 11 per cent of already furloughed workers, while a quarter have already had to make redundancies.
Although the future jobs fund cost the Treasury £720m when it ran in 2009-10, the Exchequer recouped half its cost through taxes. Yet then prime minister David Cameron axed the scheme, saying