Mersey leaders give cautious welcome to Sunak’s support

In the House of Commons on Thursday, Chancellor Rishi Sunak unveiled new COVID-19 support measures for businesses – but will it be enough? Tony McDonough reports

Rishi Sunak
Chancellor Rishi Sunak addresses the House of Commons


Chancellor Rishi Sunak has unveiled a new package of COVID-19 support for businesses, employees and the self-employed but admitted: “I cannot save every business, I cannot save every job.”

Addressing the House of Commons on Thursday, the Chancellor unveiled the Job Support Scheme to replace the furlough scheme, further support for the self-employed, Government-backed new business loans and cuts to VAT.

But the measures are not as generous as those announced in March and April and business leaders in the Liverpool city region, while giving the measures a cautious welcome, are concerned they may not go far enough and that people who missed out the first time are set to miss out again.

Mr Sunak was forced to come up with a raft as new measures after Prime Minister Boris Johnson tightened restrictions amid a rapid rise in coronavirus cases across the country. In particular all bars and restaurants will now have to shut their doors by 10pm each day and only table service is allowed.

The Jobs Support Scheme, which will replace the outgoing furlough scheme, will see workers get three quarters of their normal salaries for six months. The self-employed will see their support scheme extended for six months but at a much lower level.

Business Bounce Back Loans will be extended from six years to 10, cutting monthly repayments by nearly half and The 15% emergency VAT cut for the tourism and hospitality industries will be extended from January 2021 to March 31.

Click here for a full at-a-glance guide of the new measures

“The Government will directly support the wages of people in work, giving businesses who face depressed demand the option of keeping employees in a job on shorter hours, rather than making them redundant,” Mr Sunak said.

He added the new scheme would “support only viable jobs” as opposed to jobs that only exist because the Government is continuing to subsidise the wages. Mr Sunak told MPs: “The primary goal of our economic policy remains unchanged – to support people’s jobs – but the way we achieve that must evolve.”

The chief executive of Liverpool BID Company, Bill Addy, who represents more than 1,500 businesses in the city warned more support would be needed to ensure as many businesses as possible survived the coming winter. He said: “We cannot afford the economy to grind to a halt.

“The extension of the VAT reduction for hospitality and tourism until the end of March is much welcomed and allows these businesses, who have been some of the hardest hit over the past six months, to navigate the difficult six months we are facing.

The Job Retention Scheme isn’t as generous as furlough and we’ll wait to see how far our Levy Payers who are struggling in the current climate, especially with new restrictions, feel this will help them operate. Clarity and simplicity will be key, especially for those small businesses working hard to keep going.

“We knew that, as far as Government support goes, as the furlough scheme was ending it was never going to be business as the new normal. There’s some concern that encouraging interest free loans might encourage a level of debt we have seen in the consumer market, and we don’t want to saddle businesses with responsibilities that weigh around their necks for years to come.

“Deferrals and extensions are vital, but we are seeing an increased need for investment to target growth in areas that need it and helping us to plan for the future in a sustainable way.

“We’ll be continuing to lobby at local, regional and national government level to ensure they get what they need, not to just survive the next six months but plan for the rest of 2021 and beyond.”

Maggie O’Carroll, chief executive of Liverpool social enterprise, The Women’s Organisation, said thousands of people fell through the gaps of the first COVID-19 support scheme and she warned the same mistakes may be about to be repeated, “putting businesses, jobs and livelihoods at risk”.

She added: “Take, for example, the 40,000+ new mothers who took maternity leave in the last assessment period and were unfairly disadvantaged under the Self Employment Income Support Scheme (SEISS), and the PAYE and limited company directors who were left without access to an appropriate package of financial support.

Maggie O'Carroll
Maggie O’Carroll, chief executive of The Women’s Organisation


“We must also critique the Chancellor’s position that “we cannot safeguard all jobs”, based on the theory that if businesses still need to furlough employees now, that these jobs were never viable. This simply is not true. Take those working in the events industry as an example – these jobs would have been viable if there were not a pandemic, and they certainly will be again post-pandemic, but by then it will be too late.

“There still remains an urgent need to put women focused policies in place. We know that women have been disproportionately and negatively impacted by the pandemic and the support in place must reflect this. What we need to see now is substantial investment to help women to start and grow sustainable businesses, particularly among diverse communities and BAME and disabled women

“Further to this, we need to see policy which values women-led sectors, like the beauty and care sectors, which are typically experiencing a slower return to trade. Investing in the UK’s women entrepreneurs will be crucial in re-opening and growing our economy.”

Downtown in Liverpool chief executive Frank McKenna welcomed some of today’s measures but claimed that, overall, the Government has left too many businesses to “hang out to dry”. He explained: “If the hospitality sector is responsible for a 4.6% increase in infection rates, why is it taking 90% of the pain in terms of the new restrictions that Boris Johnson has introduced?

“And, having encouraged workers back into the office three short weeks ago, with companies investing millions in creating Covid-secure office space, why is he now telling us to work from home – hence sending our city and town centres into further crisis?

“Against this backdrop, it was always going to be difficult for the Chancellor to deliver a comprehensive business support package that can give us confidence that most jobs will be protected. I’m afraid that has proved to be the case. Although his revised ‘furlough’ scheme will help some sectors, many will not be able to take advantage of that initiative.

“If you are an events business, you literally have no business. Many hospitality venues are now on the precipice and are telling me that they will either go to weekend opening only or close their doors altogether.”

Liverpool Chamber of Commerce chief executive Paul Cherpeau said the measures would make a “positive difference” for many businesses. But he added: “We need to understand the longer term strategy.

“Businesses need more certainty, a clearer understanding of the longer term picture and a consistent approach to policy implementation and communications with fewer u-turns if we are to achieve an economic resurgence once the debilitating pandemic ends.”

Nik White
Nik White, managing partner at Liverpool law firm, Brabners


And Nik White, managing partner at Liverpool law firm, Brabners, also said: “For the region’s firms, today’s announcement is indicative of the uneven recovery that is materialising from sector to sector and what looks to be a shift in policy in favour of those businesses and roles that are best-placed to boost the region’s long-term economic health.

The North West’s resilience is largely down to the diversity of its economy, and strengths in areas such as digital, healthcare and professional services stand it in better stead than most. However, it’s imperative that businesses and devolved powers come together now to ensure we invest in new industries and skillsets to evolve with the times.”

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