BCC president warns Boris Johnson of ‘difficult winter ahead’
The president of the British Chambers of Commerce has warned the Prime Minister that businesses face the most difficult trading conditions in post-war history.
In a letter to Boris Johnson, BCC president Baroness Ruby McGregor-Smith set out a series of measures to help government take a “sharper approach” to restarting the UK economy.
“Prime Minister, a successful restart of the economy demands bolder and more ambitious action”, she writes.
“We face a difficult winter ahead – even without a significant resurgence of the virus itself. If the Government wishes to avoid mass unemployment, significant levels of business failure, and long-term economic scarring in our communities, we urge you and your colleagues to act now.”
The letter notes that local restrictions are a “single largest blockage” to restarting the economy. Baroness McGregor-Smith calls for “support for businesses shuttered by local restrictions”, in the form of additional grant funding and wage support, rather than saddling firms with further debt.
“Businesses are not ready to face the triple threat of further lockdowns, an end to government support schemes and the end of the Brexit transition period”, she added.
In the letter, McGregor-Smith calls for “far more ambitious” fiscal stimulus as the job retention scheme and various loan schemes, such as CBILS, wind down in October.
It follows recent research from BCC which revealed almost a third of firms will cut the size of their workforce in the next three months.
Director-general Adam Marshall previously told City A.M.’s podcast called on the government to cut National Insurance tax once the furlough scheme unwinds in the autumn.
McGregor-Smith is now calling for an 18-month expansion of the Employment Allowance from £4,000 to £20,000 and an increase to the threshold for National Insurance contributions from £8,788 to £12,500, which could go some way in helping companies with prolonged cashflow issues.
The letter also suggests 100 per cent business rates relief for the hardest hit sectors and their staff, as well as an extension of CBILS for new entrants beyond the autumn.