Rather than excluding the newly self-employed and company directors in accessing Bounce Back loans, the government should be supporting them to keep their businesses alive, generate new business and create new jobs. This is the line of thinking of The Federation of Small Businesses (FSB).
Of the 28 lenders accredited under the Bounce Back Loan scheme, just one is still open to applications from new customers, despite the Chancellor extending applications for the scheme to 30 November, it has been reported.
“These institutions who are not supporting viable, honest and creditworthy businesses… need to urgently hear the cries of these firms and provide vital support,” said Rowena Howie of The Federation of Small Businesses (FSB) in a City AM news report.
The FSB’s call comes as new figures showed that business confidence remains low among small firms in London, with companies in the capital most likely to report a decline in revenue in the last 3 months compared to other regions in the UK.
“It is confidence and certainty that businesses need at this time, particularly for businesses most in need of support in the hospitality, retail and tourism related sectors,” said Howie.
“A lot of small businesses have shelled out thousands to make their premises safe at a time when they had little or no revenue coming in only to be told to close,” she said in the report.
With the Job Retention Scheme set to end on the 31 October, its successor the Job Support Scheme will come into action on the 1 November.
“The new Job Support Scheme will be yet another vital lifeline to saving jobs and keeping businesses afloat, many of which remain hopeful for some relief in the run up to Christmas. But with new restrictions being imposed in every part of the country, many of which are set to get tighter in the weeks to come, small businesses face huge difficulties over the winter months ahead,” said Federation of Small Businesses (FSB) National Chair Mike Cherry (pictured) in a statement.
SME redundancies ‘a wrench’
The latest Small Business Index found that that 30 per cent of employers expect to make some staff redundant in the next three months. That is the scale of concern and uncertainty that small firms are faced with for their businesses, with many letting staff go for the very first time.
“Small firms are often similar to family units, so this is a huge wrench – often the last step a small business owner will take in order for the business to survive. If we see tougher restrictions, we are asking the Government to dial up the Job Support Scheme even further to provide more support for the small businesses that are not legally required to close but are facing a collapse in consumer demand,” said Cherry.
Let’s promote new business
“And despite this assistance, there remains little support for the newly self-employed and company directors, and it is critical that the Government addresses these shortcomings urgently in the months to come. These have had a torrid seven months, especially those in sectors that could not operate properly like events, culture, the arts and tourism. They must be kept going so they can help with a spring recovery.
“A million people are expected to enter unemployment rolls over the coming weeks and months, and therefore the onus is on Government to offer new and innovative ways to help uplift people into new jobs,” said Cherry.
He said it is important that we make it more affordable to employ people by reducing the ‘jobs tax’, Employer’s National Insurance.
“The Government’s business rate review must address and reduce the upfront costs of this regressive tax, which threatens business survival altogether,” he said.
“In addition to this, we need to see help for those who have lost their jobs and looking to start anew. The Chancellor could consider a “Kickstart Start-up” scheme, enhancing the current offer of Start-up loans and New Enterprise Allowance to drive up numbers of these new businesses. Small businesses are the backbone of our economy and we must be doing all we can to ensure they have the support they need to make it through the next few months.”