UK firms say they are still under threat despite coronavirus support
More than two thirds of UK managers say the coronavirus outbreak poses a high or severe threat to their companies, despite the government’s unprecedented economic package, a survey showed today.
The Institute of Directors (IoD) business group, which produced the survey, said more must be done to support firms. It said the government should extend support to company-owner directors, encourage cooperation from lenders and support firms without premises.
The IoD said 39 per cent of the 710 business leaders they surveyed said coronavirus poses a “severe threat” to their firm. Slightly more than 30 per cent said it is a “high threat,” while only five per cent called it a low threat.
Businesses have scrambled to find help during the coronavirus slowdown, the survey showed. Two out of five businesses have already contacted their bank about an emergency loan, while slightly more had contacted HMRC to defer tax payments.
The government has unveiled an unprecedented range of schemes to help firms throughout the crisis. These include £330bn of lending, £30bn in grants and direct help, and an offer to pay 80 per cent of the wages of employees who would be laid off.
Edwin Morgan, Director of Policy at the IoD, said: “The Government deserves credit for acting quickly and producing a substantial package of measures to support the economy, and in particular the breathing room they have provided for directors on insolvency.”
Yet he said “some gaps” in the support package “have opened up”. Morgan said that “these need to be acted upon to prevent people and businesses falling through the cracks”.
The IoD said support should be extended to small-company owners who often take their income as dividends. It said they should be able to claim 80 per cent of their income under the job retention scheme.
It also said banks should be encouraged to lend to firms as quickly as possible, and that firms without premises should be able to claim grants from the government.