Feature sponsored by Brother UK
The support offered by the Chancellor for UK businesses during the coronavirus outbreak has been unprecedented. However, there are many small businesses that have simply fallen through the cracks and missed out on all available help and support.
In March, the chancellor Rishi Sunak stood in front of the nation and promised on top of the sweeping help introduced that if more support was needed the Treasury have pledged to deliver “whatever it takes” to keep companies solvent. Since the announcement of many of the schemes, grants and loans to businesses, there have been a growing number of petitions raised amongst many of the businesses missing out on the available help. These petitions have resulted in hundreds of thousands of businesses registering their voices asking for support for all areas of the business community, particularly for small businesses that are the lifeblood of our economy.
The result of this has been the reaction of the Treasury Committee in taking these issues up as a matter of priority (The Treasury Committee is a cross-party committee of MPs that examine the expenditure, administration and policy of HM Treasury, HM Revenue & Customs, and associated public bodies, including the Bank of England and the Financial Conduct Authority). So far the Government have responded to the petitions several times and each time the Treasury Committee have rejected their response as not adequate in addressing the issue. This has now resulted in a 2 hour debate in parliament on 25 June, which will hopefully elicit a response from the government that fulfils the promise of doing all that can be done to safeguard businesses and jobs that are crucial in facilitating our economic rise from the lockdown.
Before the debate the Treasury Committee raised an inquiry into the economic impact of coronavirus which received over 16,000 submissions from affected businesses. So far they have held 10 evidence sessions with ministers, Government officials, Bank of England representatives, regulators and experts, and corresponded extensively to press the Government to improve its previous responses. In a statement from the Committee: “Government intervention to protect jobs and livelihoods is welcome but rolling out financial support at pace, and at such a huge scale, has inevitably resulted in some hard edges in policy design and some critical gaps in provision.
“More than two months on from the introduction of restrictions that locked down large sectors of the economy, many people continue to endure financial hardship whilst being unable to benefit from the Government’s support schemes. In particular, we are concerned about four groups of people:
Those newly in employment or newly self-employed “Data suggests that there are typically more than half a million people starting a new job every month, and there are likely to be hundreds of thousands of people who have set themselves up in business since April 2019 who do not meet the eligibility criteria for support.”
Those self-employed with annual trading profits in excess of £50,000 “They are ineligible for support because their profits exceed a cap set by the Government. It has been estimated that around 225,000 individuals may be included in this group.”
Directors of limited companies “Directors who take a large part of their income in dividends and are only entitled to claim support under the CJRS on the typically small PAYE component of their income. There may be around 710,000 individuals impacted.”
Freelancers and those on short-term contract “They are unlikely to be eligible for either of the Government’s two principal income support schemes. We received a large number of written submissions from people in this group.
“The Government needs to do something for these people if it is to completely fulfil its promise of protecting incomes and jobs.”
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