Chancellor unveils new reliefs for SMEs and promises turmoil will be "temporary"
17 March 2020
The Chancellor has announced £330bn of guaranteed loans to help UK businesses through the coronavirus crisis.
Rishi Sunak said the government will “stand behind business small and large” and that the new measures would help “to get business through this”.
- To support larger firms, the Chancellor unveiled a low-cost lending facility from the Bank of England.
- For SMEs, the recently launched Business Interruption Loan Scheme will now provide loans of up to £5m with no interest for the first six months.
- Grants of between £10,000-25,000 will be available for small businesses.
- Tax cuts and other measures worth £20bn will be introduced, including extended grants and business rate holidays for the hospitality sector in particular.
- The business rates holiday will be extended to all firms in the hospitality sector.
Fallout could last over a year
The new package follows the PM’s moves on Monday to escalate ‘social distancing’ in order to stem the outbreak.
Mr Sunak had previously said the economy could be living with the fallout from coronavirus for a “year or more”.
Asked how bad things will get for the UK economy in the next year, the Chancellor said: "This will be temporary and we will get through it together. All [these] interventions are designed to provide that bridge to emerge stronger."
Last week’s Budget saw the Chancellor unveil measures worth up to £12bn to soften the impact of the virus, while the Bank of England has also slashed interest rates from 0.75% to 0.25%.
The chair of the Office for Budget Responsibility, Robert Chote, today (March 17) said that the UK was in a "wartime situation" and that increased public spending should not be viewed as "an abdication of responsibility".