Responding to the Chancellor’s Winter Economic Plan, and to the
announcement that emergency insolvency measures will be extended,
Jonathan Geldart, Director General of the Institute of Directors,
said:
"These new measures should bring some relief to many directors
fearing a harsh winter for their businesses and people. As the
virus wears on, the Treasury is right to seek a balance between
protection and adjustment. However, at first blush it’s not yet
clear how much the Job Support Scheme will help hard-pressed
firms hold onto staff. The Chancellor may also have missed a
trick by not combining the Scheme with measures to encourage
wider job creation, for instance by lowering employment costs
through reduced Employers' NICs.
“The measures around loan schemes and tax deferrals will reassure
swathes of companies. The new payment plans go some way to
defusing a rapidly-approaching tripwire of built-up debt.
Extending the loan schemes marks another sensible precaution.
With revenues still limited by the virus, directors looking to
adapt their organisations will come up against cash crunches in
waves. That these changes come alongside an extension to
emergency insolvency measures, which the IoD has led calls for,
will be a double boost for struggling companies.
“Some important gaps in the support still remain. Crucially, many
self-employed and small company directors continue to go without
support, even as other schemes are continued. Meanwhile, with
business investment in the doldrums, the Treasury must act to
provide reliefs for firms to spend on digital technology and
skills, particularly as SMEs look to adapt to home-working. The
Government should also remain open to widening access to its loan
schemes, and ensuring local authorities have the funding to
provide grant support to firms that have been shut out of other
channels.
"Business leaders will hope the Chancellor is ready to return to
the crease soon to address these challenges and more, not least
the rapidly approaching end of Brexit transition."
