Business

‘No clear road map’ post-virus for struggling firms

Business leaders expressed disappointment at the lack of future clarity provided after a post-Brexit, post-lockdown, briefing hosted by Prime Minister Boris Johnson on Wednesday.

In a call with 245 firms and business groups, Mr Johnson was joined by Chancellor Rishi Sunak and the Business Secretary Alok Sharma.

The prime minister opened the call by briefing by acknowledging that 2020 “has been a tough year for businesses across the country”.

He added that firms could “now look with certainty at the year ahead”.

But according to several attendees, the government did not provide a clear road map for the UK’s economic future beyond a perceived cliff edge in the spring when key government support measures expire.

While business leaders were grateful for the additional £4.6bn in business support announced on Tuesday to help firms survive the latest lockdown restrictions – gratitude very quickly gave way to practical questions about the future.

The overwhelming desire in the (virtual) room was for a plan firms could rely upon in 2021. For most, any thoughts of post-Brexit optimism were obscured by existential threats posed by new national lockdown measures in England.

As one attendee put it: “Whatever happens over the next few months, profits and cash flow will be in the toilet.

“There is a marathon ahead and businesses will need a bit of Lucozade along the way – plus a silver blanket afterwards.”

Businesses’ wish list
At the top of the list of practical requests from attendees was an extension of the business rates holiday to the end of the year. It is currently due to end on 31 March.

Second? A plea to spare employers the expense of paying employees’ National Insurance and pension contributions for furloughed workers when many companies are making zero income.

And third, a promise to extend the furlough scheme beyond its scheduled end on 30 April to ensure that employers don’t have to pull the trigger on mass redundancies, especially when the holy grail of vaccination is possibly just weeks or months away.

Business leaders told the BBC that they would be happy for future support measures include the caveat that they could be rolled back when the tide turned in the war against coronavirus.

“It makes perfect sense to taper furlough or business rates holidays if and when the picture improves,” one said.

“Get your economic retaliation against the virus in first rather than making a last minute challenge as it skips by you,” said another.

The latest support package was welcomed. But even a significant chunk of money like that is “a cork, rather than a lifeboat to cling onto”, said one attendee.

All of the business leaders the BBC spoke to were unanimous. The vaccine is the shore. We must swim towards it as fast as possible.