£330bn ‘unprecedented’ coronavirus emergency fund

The government has announced a £330bn package of measures to support businesses through the coronavirus crisis from extensive loans and guarantees to business rates relief

‘We must act like a wartime government and do whatever we can to support our economy,’ the prime minister Boris Johnson said at Tuesday’s daily press conference. ‘We must support millions of business and tens of millions of families. We must do more and faster.’

‘This enemy can be beatable and we can beat it – we know that we can beat it. However tough the months ahead, we have the resources and the resolve to fight this.’

The financial support comes days after the Budget on 11 March when the Chancellor set out a £30bn package of measures.

‘This struggle will be won through a collective national effort,’ the PM said. ‘This national effort will be underpinned by government interventions unimaginable a few weeks ago.

This is a time for courage… I want to reassure every British citizen that this government will give you all the tools you need to get through this. We will do whatever it takes.’

There will be an initial £330bn of guarantees – equivalent to 15% of UK GDP – available to all sizes of businesses, while a three-month mortgage deferral will be available to homeowners affected by coronavirus related issues.

Chancellor Rishi Sunak said: ‘We will do whatever it takes to protect our people and businesses from the effects of this global economic emergency.

‘The government will stand behind businesses small and large with an unprecedented package of government backed loans.

‘There will be £330bn of guarantees – that means any business who needs access to cash to pay their rent, the salaries, suppliers, or purchase stock, will be able to access a government-backed loan, on attractive terms.

‘If demand is greater, I will go further and provide enough capacity as required.’

Rates will be waived for businesses in the retail, hospitality and leisure businesses, for the next 12 months.

The Coronavirus Business Interruption Loan Scheme has been expanded from £1.2m to £5m backed by an interest waiver for the first six months. More detail on how this will work is set for release early next week.

Grants to small businesses eligible for Small Business Rate Relief will be increased from £3,000 to £10,000. There will also be a further £25,000 grants for retail, hospitality and leisure businesses operating from smaller premises, with a rateable value over £15,000 and below £51,000.

There will also be support for liquidity among large businesses, with a major new scheme being launched by the Bank of England to help them bridge coronavirus disruption to their cashflows through loans.

There was also clarification that government advice to avoid pubs, clubs and theatres is sufficient for businesses to claim on their insurance where they have appropriate business interruption cover for pandemics in place.

To support the food industry and help provide meals for people who need to self-isolate, planning regulations will also be relaxed to allow pubs and restaurants to start providing takeaways without a planning application.

Over £3.5bn in additional funding will be provided to the devolved administrations for support to businesses in Scotland, Wales and Northern Ireland.

Other initiatives will be announced later in the week, focused on employment related issues as well as a potential support package for airlines and airports.

Treasury factsheet: How to access government financial support if you or your business has been affected by covid-19 Issued 18 March 2020 [subject to change]

 

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