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struggling companies will now have until the end of March to access the government’s generous loan schemes
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The Chancellor also confirmed that the Budget will be on March 3 and outlined the next phase of the plan to fight the virus and protect jobs
The leave scheme has been extended until the end of April 2021 and the government continues to contribute 80% to salaries, giving businesses and employees across the UK certainty in the New Year, the Chancellor announced today.
In a move to ensure businesses can access the support they need through continued economic disruption, Rishi Sunak also confirmed that he will extend government-guaranteed Covid-19 business loan schemes until the end of March.
These changes are ahead of the Budget, which the Chancellor has confirmed will take place on March 3, 2021. This will deliver the next phase of the plan to fight the virus and protect jobs, thus extending the commercial and loan schemes. Licensing allows companies to plan with certainty and access support in the early months of the New Year before the additional update on the broader financial support of Covid-19.
So far, the Coronavirus Job Retention Scheme (CJRS) scheme has protected 9.6 million jobs across the UK and more than a million companies have accessed loans to help them weather the crisis.
Finance Minister Rishi Sunak said:
“Our business and worker support package remains one of the most generous and effective in the world, helping our economy to recover and protecting livelihoods across the country.
“We know that premium companies prioritize certainty, so it is right that we allow companies to plan ahead regardless of the path the virus takes, so we provide certainty and clarity by extending this support, as well as implementing our Plan for jobs “.
Commercial Secretary Alok Sharma said:
“While our loan schemes have provided a vital lifeline to millions of businesses across the country, we know that business owners need additional certainty as we approach the New Year.
“The expansion of government-backed loan schemes will give businesses across the UK the funding they need to support, protect and create jobs as we rebuild better after the pandemic.”
The Chancellor said he would review the CJRS employer contribution element in January, but decided to move it forward to allow companies to plan ahead for the rest of winter and the New Year.
The government will continue to pay 80% of employees’ wages for hours not worked until the end of April. Employers will only be required to pay wages, national insurance contributions (NICS) and pensions for hours worked; and NICS and pensions for hours not worked.
The eligibility criteria for the UK-wide scheme will remain unchanged and these changes will continue to apply to all decentralized administrations.
Extending the scheme until the end of April means that companies across the country will have certainty about the support they will have at their disposal.
Companies will also be given until the end of March to access the Recovery Loan Scheme, the Coronavirus Business Interruption Loan Scheme and the Coronavirus Business Interruption Loan Scheme. These were to close at the end of January.
The schemes have already provided more than £ 68bn in secured loans and helped keep business afloat in all sectors of the UK economy that have been affected by the coronavirus.
We are expanding plans now, before Christmas and beyond the new year, to ensure that businesses can continue to access the support they need to grow and recover.
The government has already announced that more support will be available after March, through a successor loan scheme. More details of the scheme will be announced in due course, and the government will provide an additional update on the broader financial support of Covid-19 in the Budget on March 3.
Licensing and loan schemes are part of the government’s broader plan to support, create, and protect jobs through its Jobs Plan. This includes the Kickstart Plan, plus investment in training and skills, as well as the Self-Employment Income Support Plan grant, with a fourth grant available from February through April 2021.
More information:
- Extending the CJRS until the end of April gives companies certainty well before the 45-day layoff notice period, and the budget sets the next phase of support more than 45 days before the plan’s new end date.
