Over the coming weeks, The Forum will seek to provide business-relevant information, comment and points of access to support our local enterprises.
We note and will actively support the creation of The Chipping Campden Corona Virus Support Hub, http://www.chippingcampdenonline.org/corona-virus/
The Government have generated the following documents on their web which are of use as base sources for general advice. They may assist businesses in formulating their response.
1. Support for businesses who are paying sick pay to employees
2. Support for businesses that pay business rates
3. Support for businesses that pay little or no business rates
4. Support for businesses through the Coronavirus Business Interruption Loan Scheme
5. Support for larger firms through the COVID-19 Corporate Financing Facility
6. Support for businesses paying tax
1. What you need to know
4. What to do if someone develops symptoms of coronavirus (COVID-19) on site
5. Travel arrangements
6. Sick pay
7. Certifying absence from work
8. What to do if an employee needs time off work to look after someone
9. Limiting spread of coronavirus (COVID-19) in business and workplaces
10. Cleaning and waste
11. Handling post or packages
1. Staying at home
2. Working from home
3. Sick pay
Government Support and where to find it
- On 17 March 2020 the Chancellor set out in some detail a package of temporary and targeted measures to support businesses through the period of disruption caused by COVID-19.
The Government package includes:
- Statutory sick pay relief for SME’s
- Business rates relief for small businesses and pubs
- Small business grant funding of £3,000 for all businesses in receipt of Small Business Rate Relief
- The Coronavirus Business Interruption Loan Scheme (“CBILS”) to
- long term viable businesses who need additional finance for
- The HMRC time to pay (“TTP”) Scheme
- Given the potential severity of disruption many businesses will need assistance in the form of the CBILS and TTP, and that the other measures will be insufficient on their own.
The Scheme will be delivered by the British Business Bank (“BBB”) and will launch in “a matter of weeks”. Whilst BBB will provide a guarantee of 80% of the loan, the loans are expected to be approved and made by the clearing banks and other authorised lenders. There will be per lender caps and the scheme will support loans of up to £5m. At the time of writing, the clearing banks are not aware of the terms and detail of how the scheme will operate. “A matter of weeks” needs to be “a matter of days” as some businesses do not have weeks in the current circumstances. We understand that further detail will be available next week.
The National Loan Guarantee Scheme (“NLGS”) was launched in 2012 to offer cheaper loans, and more importantly was government guaranteed. This facility is now closed, however the general criteria for a successful application, was a company’s ability to demonstrate viability following the granting of such facilities. It is also expected that this scheme will only be available where no other way of borrowing money is possible ie it will be a loan of the last resort. The criteria will clearly have to be relaxed as the government has indicated that the new scheme is a bridging loan available “to support long term viable businesses”.
The Expected Criteria
The key would therefore seem to be to be able to demonstrate “long term viability”. We would therefore recommend that management commence immediate work to:
- · Demonstrate that their business was viable prior to the current world crisis
- Demonstrate by forecasts that the applied for loan will be sufficient to enable to business to survive for the next 3-6 months of disruption; and
- As far as possible demonstrate that after the current crisis, viability can be restored and the business is capable of repayment of the loan. We appreciate that this will be dependent upon the eventual length of the loan, which is not yet revealed. The NLGS was for 1-5 year loans.
The process when introduced is unlikely to be instantaneous as the NLGS quoted a 3 week assessment period, and whilst the government guarantees 80%, the Banks exposure remains at 20%. We do not believe that personal guarantees will/should be required based upon the Chancellors comments to date, and as we are literally in a world of uncertainty, any such requirement would render the assistance extremely ineffective.
The MP meeting on Friday 27th March and the
CBF Breakfast Meeting on Tuesday 7th April 2020 have both been cancelled. Refunds will be given.
Campden Business Forum