Business leaders in the West Midlands have been reacting to the Government’s latest coronavirus lockdown and the Chancellor’s package of financial measures aimed at easing some of the hurt caused by the restrictions.
Rishi Sunak has announced £4.6 billion of lockdown finance which will see retail, hospitality and leisure businesses receive up to £9,000 in one-off grants.
There is also a £594 million discretionary fund for other businesses that might be affected, an additional £1.1 billion in grant funding for local councils and local restriction support grants worth up to £3,000 a month.
It was announced before Christmas that the job retention scheme, known as furlough, has been extended until the end of April.
This new funding coincides with Prime Minister Boris Johnson plunging England into a third lockdown, with only essential retail allowed to open alongside ‘key’ services such as vehicle repairs, petrol stations and childcare while schools are staying open for the children of key workers.
Mike Cherry, who is national chairman of the Federation of Small Businesses and director of Staffordshire timber merchant WH Mason & Son, branded the current level of business support as “plainly insufficient”.
He said: “While there is an overarching need to protect public health and bring coronavirus under control, this is disheartening news for small businesses and a blow to an economy that’s already on its knees.
“Restrictions have been a harsh reality for almost a year and this is anything but a fresh start to 2021.
“The news of a new tougher lockdown will cause widespread business failure and job loss unless support is provided on an equal scale to these unprecedented curbs on economic freedom.
“Current business support is plainly insufficient. There must now be a step change in support to equal the compensation offered during the first lockdown.
“The level of government grants is off the mark by an order of magnitude and has not kept the pace with events.”
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Henrietta Brealey, director of policy and strategic relationships at Greater Birmingham Chambers of Commerce, said businesses in the city region had had to operate under five different levels of restrictions over the past ten weeks alone.
“These latest measures broadly mirror those in March. Consequently, it is only right businesses receive support at least equivalent to that received at the time – particularly as many are in a far worse state financially now after nine months of limited to no income,” she said.
“This includes enhancing grant support and better targeting it to the most impacted businesses, addressing gaps in covid support, removing requirements to pay national insurance and pension contributions for furloughed staff for closed businesses and bringing forward further rounds of VAT deferrals.
“We will continue to urge the Prime Minister and Chancellor to ‘Back Our Businesses’ with the above as well as giving businesses greater headroom to plan by extending VAT reliefs and targeted business rates relief into next financial year alongside other key measures.”
Tony Hague is chief executive of PP Control & Automation, a Walsall-based manufacturing group which supplies machinery builders worldwide.
“Like the last lockdown, many manufacturers will remain open and, in our specific case, we are providing critical outsourcing, assembly and manufacturing services for key clients involved markets such as medical, food processing and packaging, and specific projects in relation to covid-19,” he said.
“My only concern is that, if demand dips in certain sectors, some companies may take the decision – based on costs – that it is more effective to furlough staff and close the doors rather than look to operate at a reduced capacity.
“Now, once again, is the time for UK manufacturers to be bold, brave and innovative and seize the opportunities, however challenging the landscape may be.”
The Chancellor’s measures were welcomed by Coventry and Warwickshire Chamber of Commerce but the body wants the Government to set out a long-term plan that not only helps companies survive for now but also builds the recovery after it.
Chief executive Louise Bennett said: “After the announcement of the new lockdown, many businesses across our patch will be relieved to hear the Chancellor announcing a new round of support so quickly.
“It’s now vital the money gets out to the businesses that need it most as soon as physically possible in order to support their cash flow at this devastating time.
“What businesses really want to see now is a longer-term support package that is more than about surviving the next few weeks but how they can plan for the rest of the year and not only come through the crisis but also grow out of it.”
Alan White, leader of Staffordshire County Council, added: “Many people have already sacrificed so much and this will be devastating news for our residents, businesses and schools. However, despite the Tier 4 restrictions, cases are continuing to rise and the Government has decided that a third lockdown is needed to help stop the NHS becoming overwhelmed by this virus once again.
“As a county council, our focus will remain on providing the best support for residents and businesses most in need. We now need the support of people who live and work in Staffordshire like never before to see us to a time when the promise of the vaccines can be fully delivered and their benefits truly felt.”