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."