Call for support
CBI wants new support to help firms beat recession
Dame Carolyn Fairbairn: companies cannot wait (pic: Terry Murden)
CBI boss Dame Carolyn Fairbairn, is urging the Government not to switch off the life support that is helping businesses fight their way out of recession.
Firms across the UK recognise and appreciate the scale and speed of Government schemes, but the survival of many firms in hard hit sectors hangs in the balance, she said.
Dame Carolyn, diretor general of the business group, said that given the scale of existing initiatives, further action needs to be targeted and efficient. She called for a further extension of the jobs support scheme and a deferral of VAT payments.
The priority for business is direct, fast support that ensures firm survival and boosts demand across the economy. The main proposals are to:
- Extend grant support schemes for SMEs via local authorities to help local businesses survive;
- Extend Business Rates relief in England to mid-sized businesses in all sectors for the next three months to help supply chains recover;
- Immediately defer VAT payments for businesses in second quarter of 2020 to support cashflow and investment;
- Extend the deadline for the Coronavirus Business Loan Scheme beyond August for a further three months;
- Kick-start consumer demand through targeted VAT cuts in enabling sectors and reduce Stamp Duty for cheaper homes [in England] by increasing the tax-free allowance for six months;
- Accelerate local infrastructure upgrades in 2020/21 by increasing funding for local authorities so they can deliver shovel ready green projects and transport improvements.
The CBI wants the package of business support to be backed by a major Jobs Scheme focussed on helping young people into employment, delivered at speed and scale.
Dame Carolyn and CBI Scotland director Tracy Black wrote on Monday to Scotland’s First Minister calling for faster investment in the green agenda, the go-ahead to shovel-ready projects, and further reform of business rates as part of an urgently-needed recovery plan.
Today’s demands take account of matters reserved to Westminster such as the Coronavirus Business Loan Scheme and VAT. Should either be changed by the Chancellor there would be consequentials for the devolved nations.
Dame Carolyn said: “The [UK] Government’s support of business during the crisis has saved countless firms. But the rising number of redundancies and benefit claimants shows just how hugely damaging this pandemic has been for our economy.
“The survival of many businesses in hard hit sectors still hangs in the balance over the summer as schemes begin to wind down. These firms cannot wait until the autumn for further action.
“The Government has already shown its ability to be bold and decisive. By getting ahead of this tidal wave of economic damage with at scale, at speed, targeted support, it can help businesses survive, protecting the jobs and life chances of a generation.”