The Director General of the Institute of Directors, Jon Geldart, Shadow Business Secretary Ed Miliband and a host of backbench MPs have called upon Rishi Sunak to use his Budget statement on Wednesday to announce that the Job Retention Scheme, along with business rate relief and the Stamp Duty holiday, will all be extended as the country emerges from a third national lockdown.
Mr Sunak today has confirmed to The Yorkshire Post that support schemes will be extended and pledged to reveal more details in his much-anticipated Budget.
Prime Minister Boris Johnson announced on Monday details of the Government’s road map to reopen the economy which showed many sectors - most notably hospitality and leisure - will be unable to re-open fully until as late as June. The Government’s most recent data showed an estimated 4.7m people are still on furlough nationwide, the majority of whom are women.
The scheme has come at an astronomical cost to the Government, and the Chancellor is under mounting pressure from deficit hawks in his own party to reign in spending.
However, some of the country’s most prominent business leaders told The Yorkshire Post that such a move would be catastrophic for many businesses which are already under immense financial pressures.
Mr Geldart, a Harrogate-based businessman who took the reigns of the IoD in 2019, said: “It is so important that we navigate the reef that is before us before we hit the beach of solid ground in the summer.
“Careful navigation is going to be required to make sure that businesses are supported across the UK, but particularly in this region which is so reliant on a mixed economy of tourism and leisure through to manufacturing.
“The Chancellor will need to think really carefully about how he is going to impact the whole of the UK but, particularly for me being a local lad, in this region.
“We are expecting to see a soft landing on the Job Retention Scheme and the Self-Employment Income Support Scheme.
“We are looking for those to be extended for as long as possible. The ask from us to the Chancellor is that, as long as restrictions remain, so should the support.”
Mr Geldart, along with other business leaders, held a meeting with Mr Sunak this week to put this case forward.
He added: “I would be very disappointed if we found there was going to be a cliff edge for support schemes. I think that would be catastrophic for businesses that are teetering on the edge. People have taken on debt.
“We have seen a significant amount of small and medium sized businesses, which are the bedrock of the economy - particularly in this region - taking up loans, from Bounce Back through to CBILS loans. Just to pull the plug would be unwise in the extreme.
“One of the other things we are interested in is business rate relief. Many businesses are not even in their premises, and yet are paying rates. I would like to see the Chancellor look at this.”
The IoD chief was supported in his views by former Labour leader Mr Miliband, the MP for Doncaster North.
He said: “Yorkshire has a particularly high proportion of tourism and hospitality businesses, which have been hit hard during the pandemic - and so the region will feel the blow even more deeply if they go to the wall.
“We cannot let Yorkshire businesses be left out in the cold. Ministers must recognise the huge potential industries, businesses, and people in Yorkshire have to lead our economic recovery, and they must ensure they have the investment needed to realise that potential.”
The Conservative MP for Thirsk and Malton, Kevin Hollinrake, who enjoyed a successful business career before entering Parliament having co-founded the Hunters estate agency, said extending business support was “the number one thing” he wanted to see Mr Sunak announce at the Dispatch Box next week.
“There has been some fantastic support over the past year and the Treasury has never moved quicker,” he said. “That has kept businesses in business and people in jobs. The crisis has gone on longer than anticipated, relief on business rates and the jobs retention scheme need to be extended, and stamp duty as well.
“Protecting businesses from hopefully the last weeks and months of the lockdown and suppression of the economy.
“I would like to see some kind of stimulus to the economy and maybe some tax breaks for areas that need levelling up, and incentives for private businesses that need to expand.”
The Labour MP for Batley and Spen, Tracy Brabin, who is also Labour’s candidate for the new mayor for West Yorkshire, said: “We want the furlough extended, the Universal Credit £20 top-up extended, basically the support that has been put in place for working people. Those must be extended beyond March because we are not out of the woods.”
And Robert Goodwill, the Tory MP for Scarborough and Whitby, added: “It would be a crying shame if these businesses that have been kept on economic life support for a year that they would fall at the last fence.
“There will be a time where we need to address the deficit and balance the books, but this is not the time yet. The economy is in a very fragile state. Some businesses like wedding venues and nightclubs haven’t opened at all, they’ve had no respite. We need to make sure when the country is free that businesses are there in hospitality and tourism.”