Responding to the PM's statement, the IoD called on Government to outline its next phase of business support, setting out key steps it could take:
Roger Barker, Director of Policy, said:
“These new measures will inevitably put the brakes on the economic recovery somewhat, but businesses will hope they prevent stricter measures down the road. With the return of more restrictions, the onus is squarely on the Government to set out the next phase of its support.
“Key schemes are set to wind down in the months ahead, but it's clear that businesses aren't out of the woods yet. Even where the Treasury wants to move away from the current shape of flagship measures, it should look to fill the gap to prevent a steep rise in unemployment and insolvencies. The Government should also seek to help small firms adjust and adapt to the circumstances.
“The spread of the virus isn't wholly predictable, but the back and forth on offices will cause frustration. Business leaders are eager for the Government to focus on the foundations, issues like childcare, public transport, and getting the testing system firing on all cylinders.”
The IoD recommended the following measures to provide business support in the months ahead:
- Extend emergency business interruption loan schemes allowing viable firms to borrow.
- Reduce employment costs by cutting Employers' NICs, while looking to adjust the furlough scheme so it can support businesses directly impacted by lockdown measures.
- Extend emergency insolvency measures to remove the threat of liability for so-called ‘wrongful trading’ from those struggling firms who seek finance.
- Ensure Local Authorities have the flexibility and funding to allocate local discretionary grants to support more businesses.
- Provide tax incentives to support SMEs to adopt digital practices and technology.