Business support is stagnant – some businesses may not get it

The Ministry of Economy and Innovation is currently preparing two new instruments, grants and soft loans, which should receive up to 110 million. euros.

These measures have been in the public domain for several weeks, but have not yet been approved by the government and will need to be notified to the European Commission, so the ministry believes that the measures could be applied from December in the best of cases. .

The new government should take the oath in mid-December: its future director Ingrida Šimonytė criticizes the proposed aid scheme, such as the requirement that not only the company’s turnover has fallen by 30%, but also the total income of the entire sector exceeds 40%.

“When I try to create multi-step claims that, on the one hand, both you have to be affected and your whole area has to be affected, I would say that from a human point of view, if I am a restaurant, I don’t care at all how much my branch has suffered if “The government has restricted my activities with its decisions,” the prime minister-designate told Info TV on Monday.

In Lithuania, the quarantine is in effect for the second week in a row and some sectors have been restricted until then, so trade representatives say support is already delayed.

“When it comes to the fact that after a month (support – BNS can happen), it becomes very sad for me, because after a month, the word late does not reflect how late it is. It seems to me that in the state we don’t We realize that this is an everyday issue, “Andrius Romanovskis, president of the Lithuanian Business Confederation (LVK), told BNS.

He previously proposed to change the downtime compensation mechanism so that companies, unlike now, no longer share risk with the state and the state compensates 100% to some extent. employee downtime.

The Minister of Social Security and Labor, Linas Kukuraitis, has previously mentioned that there is no plan to change the downtime compensation procedure, but according to A. Romanovskis, the 100% subsidies would help prevent cases such as the Eglė sanatorium, which lay off half the employees due to drastically reduced orders.

Additionally, LVK proposes to temporarily suspend the implementation of the DNA Plan for the Future Economy, as companies currently need to survive the second quarantine.

Some may not be supported

Businesses say some businesses may not get the support they promise and fail. The Council of Small and Medium-sized Enterprises says it spoke with Deputy Minister of Economy and Innovation Jekaterina Rojaka about the support measures and criteria envisaged last week and expressed a “strong position.”

“I think yes, some companies will not be supported and will simply fail. This advance, backtracking, judgment and everything else, I have the feeling that our officials have nothing to do,” said Dalia Matukienė, chair of the board, at BNS.

He said that this week the association will address other institutions and their leaders: the Presidency, the Prime Minister, the Ministries of Social Security and Labor and Finance.

“It just came to our attention then. Aren’t we those victims, all small businesses? How can we recover then and who will collect those taxes? Somehow we have to look forward,” said D. Matukienė.

Milda Plepytė-Rainienė, director of the Lithuanian Tourism Association, also says that some tourism companies that have probably suffered the most from the pandemic may go bankrupt without receiving support.

“Depending on how much support will be delayed and when the measures that the associations requested in the summer will finally be received,” Ms Plepytė-Rainienė told BNS.

“We really look forward and have high hopes that these measures will not be delayed, as has been the case with other measures,” he added.

Downtime needed, wage subsidies

When evaluating the measures that would be most effective and sustainable until the end of the pandemic, companies say that downtime and wage subsidies are vital.

“It just came to our notice then. We also offered a percentage of the taxes paid, all the options when it would be possible to transfer in a few days,” Evalda Šiškauskienė, president of the Lithuanian Hotel and Restaurant Association, told BNS.

“The second is downtime, but now the percentage should change, because the company will no longer have to contribute. We suggest that it be at 100 percent. Minimum wage (MMA) and change the percentage to at least 20/80%. skilled workers, because eventually people will go to the Employment Service and it will cost the state 3-4 times more, ”he said.

The association president added that he also intends to extend rental subsidies.

“This would be especially useful for the catering industry, as most of the premises are rented out,” stressed E. Šiškauskienė.

Ms Plepytė-Rainienė also says there is a need to extend wage subsidies, which she says would help tour operators to continue their activities next year. In addition, he said, excessive requirements for specific loans should be eliminated.

“We need to deal with the measure and remove the excessive requirements for soft-target loans in order to reach an agreement with consumers who want their money back. This is a vital tool, number one, ”said M. Plepytė-Rainienė.

It also highlights the need to subsidize companies whose turnover has fallen dramatically this year compared to 2019. According to her, the maximum 50 percent. The cartel of the drop in turnover is initially the “right amount”, but as the pandemic and the tourism business continue to generate almost no income, a higher percentage should be considered.

Feel distrustful

When the authorities consider introducing, in the opinion of the employers, excessive criteria for companies applying for state aid, the associations say that this is also a kind of result of state distrust in companies.

A. Romanovskis affirms that, in addition to distrust, there is also a fear of public officials to assume responsibilities.

“One thing is mistrust and at the same time the fear of employees to take responsibility. We are seeing many acquisitions scandals, it is the employees who are afraid of taking responsibility, that is why they are protected by clearer criteria ”, said the president of LVK.

According to him, the demand for a solidarity distribution of the financial burden of the crisis caused by the containment of the economy to manage the health crisis reveals both “cynicism and misunderstanding”.

“They don’t see it as an extraordinary crisis and they think it’s just another financial crisis, that if you can’t bear it, you could die and someone else would take your place,” Romanovsky said.

D. Matukienė says that mistrust is mutual.

“I think the main problem here is that companies don’t trust state institutions and they don’t trust companies. If they were in a very clear middle ground, then there would be no additional administrative burden or burden for Invega, he told BNS .

According to the representative of small entrepreneurs, the new government is expected to consult with the company from the beginning.

“The ministries are now starting to negotiate with the company once they have written the full initial description. And then they say, you know, we can’t change this and then the imitation of the pronunciation begins,” said D. Matukienė.

“If we want a result, we have to start negotiating from the beginning,” he stressed.