The Chancellor has announced new extra help for small businesses:
- Interest free loans for 12-month of up to £50,000 (max 25% of turnover)
- 100% government backed
- Cash in your business account within 24 hours
- Starts on May 4th
It will fill in a real gap for many small firms.
Over the last few weeks my team have stepped in to help constituents in difficult situations. I've spoken to BAE and helped 80 staff working for a contractor at BAE Washington to get furlough pay after their employer initially left them in the lurch. I've worked with a local trade union to delay a consultation on a change to TUPE working conditions and helped speed banks making decisions on Business Interruption loans. It has been really humbling to receive emails (like the one pictured) from local businesses but makes it all worth while.
We've had other battles that we haven't won (one was with a Franchise owner of Costa Coffee in Consett who is point blank refusing to give Furlough to anyone who hadn't been employed by them for over three months (which is utterly disgraceful) and some businesses haven't got the loans they were after but I'll fight for all of my constituents and all my businesses. All I ask is that if you're in a position to help others, please do so, particularly if you've former employees coming back to your for furlough. This is a time for magnanimity and helping those in need.
This new scheme is on top of:
- Employee Job Retention Scheme (Furlough) This allows anyone on the payroll before the 19th March to get up to 80% of their salary (+pension and employer national insurance) covered by the Government. This was lobbied hard for by me and other MPs anxious to stop what we've now seen in America. This covers wages up to £2,500/month. So far this amounts to over £4.5 billion in direct support. If you changed jobs after this time you can go back to your former employer (if you left voluntarily) to seek support. We can't guarantee that they will say yes but we will help you to ask.
- Business grants - half a million business properties have benefited from £6 billion of business grants so far. This is £25,000 for businesses in the hospitality and leisure sector and £10,000 for other small businesses. The money comes from central Government and is distributed by Durham County Council who have paid out approximately 85% of the money so far.
- Coronavirus Business Interruption Loans Scheme (up to £5m loans, those up to £250,000 don't require collateral and primary residences are excluded from any collateral claim). If you need this, the loans are flowing through but I chatted with the Economic Secretary to the Treasury and he said people might get quicker responses from some of the newer banks (who face the same regulations but have newer systems) like Starling Bank and Oak North Bank.
- Covid Corporate Financing Facility, which has provided over £14 billion for larger firms via the Bank of England.
- Generous VAT deferrals worth billions of pounds for hundreds of thousands of businesses.
- Scrapped businesses rates for all hospitality businesses and all businesses with a rating of under £51,000.
- The Government is also covering the cost of statutory sick pay and it is paid from day one.
- Self employed scheme. Again, pays up to £2,500/month as long as the business has been in operation for a year and filed accounts.
- Also, self employed taxes have been deferred until January 2021 and HMRC are being very generous in terms of "time to pay" - just call them if you need help.
- Increased Universal Credit for millions affected who can't benefit from other schemes. This is particularly helpful if you've got children and rent to pay. The DWP have been working very hard to ensure the system works quickly and you can get an advance on the money if you need it.
Best wishes and stay safe,
Richard Holden MP