Just seven days after his first Budget statement, chancellor Rishi Sunak has announced a host of new measures to further protect Britain’s businesses against the effects of the coronavirus pandemic.
Last week’s Budget had already promised a fiscal stimulus of £30 billion to combat the ongoing crisis – but in a press conference yesterday Sunak announced additional provisions would be made available to businesses, to the tune of £330 billion.
The measures which are now being implemented, which are equivalent to 15% of GDP, were “unimaginable” just two weeks ago according to the chancellor.
Small business provisions
Among the provisions announced is a grant system aimed at small businesses, which will, of course, include a lot of design studios and companies. This Small Business Rate Relief can now go up to £10,000, rather than the £3,000 that was originally announced in last week’s Budget. Those wanting to apply for the relief fund should head to the gov.uk website for more information.
Many creative organisations and cultural spaces will also likely benefit from Sunak’s extension of a 12-month 100% business rates holiday, which is now being rolled out to all businesses in the retail, hospitality and leisure sectors.
On top of this, those institutions operating from premises with a rateable value between £15,000 and £51,000 can also apply for further grants of up to £25,000, to deal with business expenses.
Beyond provisions for small businesses, Sunak also introduced an updated Coronavirus Business Interruption Loan Scheme, boosting potential borrowing from £1.2 million to £5 million. The first six months of this finance will be interest free for borrowers.
Sunak also announced that lenders had agreed to a mortgage moratorium for up to three months for those affected by the coronavirus.
While this was welcomed alongside the additional financial aid, some industry bodies believe the government is yet to tackle other pressing issues experienced in the wake of COVID-19.
Commenting after Sunak’s announcement yesterday, Creative Industries Federation CEO Caroline Norbury said: “The measures announced on mortgage payments and alleviating hardship are welcome but fall short of guaranteeing these workers’ income – a government measure that is now desperately needed.
“A third of the UK’s creative workforce is self-employed and they will be hit hard.”
In Design Week’s guide to coronavirus finance for freelancers which was released this week, a spokesperson for the United Voices of the World’s Designers and Cultural Workers branch said that more than just mortgage holidays, the creative industry needs rent freezes across housing and studio spaces too.
In PMQs today, Boris Johnson said he was “bringing forward legislation to protect private renters from eviction” – however this has been criticised by some as simply shifting the problem, if it is not implemented properly.
The government is reportedly going to help tenants by preventing evictions related to coronavirus.
This, by itself, would be – well, it would be *something*, but it would also be totally inadequate.
All that would happen is people would build up big rent arrears.
— Chaminda Jayanetti (@cjayanetti) March 18, 2020
Elsewhere in yesterday’s update, the government also announced it would be postponing the implementation of much-criticised changes to IR35 legislation. The reforms will now come into effect on 6 April 2021, rather than 6 April 2020, as originally planned.
Design Week reported back in February how the industry was largely against such measures, for reasons including a projected 25% loss of earnings, with few additional employment rights.
Philippa Childs, head of creative industries trade union Bectu, welcomed the delay, saying: “Now is not the time to introduce complicated measures that the private sector of the economy was not fully prepared for.”
Childs went on, however, to say that this wasn’t enough to properly support freelancers and the self-employed.
“Further measures need to be introduced to ensure that freelancers who facing their entire livelihoods being wiped out are not left in financial ruin,” she says, adding that Bectu is calling for interest free tax back loans, 0% interest loans on other forms of borrowing and help for renters in the wake of the crisis.
The updated support plan was largely welcomed by the Design Council’s senior policy advisor Matthew Young, who told Design Week: “Business support is essential both now and into the future, to save and then nurture our innovators and suppliers.”
Young went on to say that he hopes designers and their various skill would be approached to help out in the response.
“Designers can be crucial in the immediate and medium-term response to coronavirus, as key public services reshape, business processes and practices adapt to changed realities, and as new medical and other products are designed, tested and manufactured.
“And as we emerge from the immediate crisis, they will be central in ensuring we are better equipped to deal with pandemics and major public health issues. I know designers across the country are ready to contribute and I urge government at every level to make use of them.”