Declaring an ‘economic emergency’, Chancellor Rishi Sunak said: ‘This is not a time for ideology and orthodoxy, this is a time to be bold, a time for courage’
A huge £330bn support package for businesses fighting for survival amid the coronavirus crisis has been unveiled by the Government.
Offering an unprecedented parcel of support for firms across the UK, including new lending via banks and cash grants, Chancellor Rishi Sunak said: “This is not a time for ideology and orthodoxy, this is a time to be bold, a time for courage.”
He added that, as the number of coronavirus cases and deaths continued to rise, it was necessary to address what he called “economic emergency”, adding: “Never in peacetime have we faced an economic fight like this one.”
Liverpool city region business business leader Frank McKenna, chief executive of lobby group Downtown in Business, welcomed the announcement but urged the Government to make sure it got the delivery right, asking whether banks were the right vehicle.
The £320bn injection represented, he said, around 15% of total UK GDP and he promised there would be even more support available if the current proposals proved not to be enough. And he said the new initiatives would be up and running by early next week.
He said he was extending the business rates holiday announced in last week’s Budget, to all firms in the hospitality sector and funding grants of between £10,000 and £25,000 for small businesses. He added that for those in financial difficulty due to coronavirus, mortgage lenders will offer a three-month mortgage holiday.
Businesses across many sectors are facing an immediate crisis as the public are told to avoid social contact as much as possible. The hospitality sector – bars, restaurants, cafes, hotels – is expected to be worst hit as well as the airline sector. One Liverpool hotel alone has lost more than £2m in bookings over the next few months.
Mr Sunak added: “Some sectors are facing particularly acute challenges. In the coming days, my colleague the Secretary of State for Transport and I will discuss a potential support package specifically for airlines and airports.
“I want to reassure every British citizen this government will give you all the tools you need to get through this.” The £330bn package was, he said, equivalent to 15% of UK GDP. That means any business who needs access to cash to pay their rent, their salaries, suppliers or purchase stock will be able to access a government-backed loan or credit on attractive terms.
“And if demand is greater than the initial £330bn I’m making available today, I will go further and provide as much capacity as required. I said whatever it takes, and I meant it.”
Frank McKenna, who this week called for a Liverpool city region ‘business COBRA’, told LBN: “It seems the cash is now there for business – the question is how quickly can we get it to its target market. I am not convinced that the banks are the right vehicle to implement what is an unprecedented business support package.
“How we signpost companies to the access to finance opportunities is crucial and I repeat my call to give that job to regional business support agencies.
“At the very least, Metro Mayor Steve Rotheram needs to be given the powers and resource to closely monitor banks and financial institutions performance on this. Overall, it’s a positive Government response. Now it’s all about delivery. I still think the hospitality sector is in crisis and we are meeting with members from that sector tomorrow to gauge their reaction.
“That will be followed by a telephone conference with the mayor and business organisations. It’s time for us to get ahead of this situation now with a coordinated approach and strategy.”