Measures announced in the Budget to help businesses ride out the Coronavirus outbreak will save some Cumbrian firms from going under, the county’s Chamber of Commerce says.
Chancellor Rishi Sunak announced a business rates holiday for many retail, hospitality and leisure businesses, more time for businesses to make tax payments, emergency loans underwritten by the Government, grants for the smallest businesses and reimbursement of statutory sick pay for SMEs.
Rob Johnston, Chief Executive of Cumbria Chamber of Commerce, said: “Coronavirus is already disrupting supply chains and altering consumer behaviour.
“It will create severe cash flow problems for many businesses. There’s a danger the economy could slip into recession and that some businesses could become insolvent.
“The Chancellor’s measures will mitigate the impact and could make the difference between survival and collapse for some.”
Elsewhere in the Budget, Rob was delighted to hear the Chancellor pledge to rewrite the Treasury’s Green Book rules on infrastructure spending.
He said: “This should ensure Cumbria gets a larger slice of the cake – the rules as they stand benefit London and other major cities at the expense of areas like ours.”
Rob also welcomed the freeze in fuel duty and extra spending to improve broadband, remove mobile phone ‘notspots’ – this a long-standing Chamber campaign – £600bn for transport infrastructure and £12bn for affordable homes.
He added: “Improving infrastructure is a sure-fire way to grow the economy and improve productivity.
“Chambers of Commerce have been saying this for years and, finally, the message seems to have got through.
“Cumbrian businesses will be particularly pleased to see that the Chancellor is pushing ahead with the scheme to upgrade the to A66 to continuous dual carriageway between Penrith to Scotch Corner and he’s doubled spending on flood defences. We know all too well the damage that flooding can cause.”
But Rob sounded a note of caution on the Chancellor’s plan to raise the National Living Wage to two-thirds of median earnings by 2024, which could see it reach £10.50 an hour.
He said: “Our concern is that this affects some sectors of the economy disproportionately.
“Hospitality and retail, for example, have large numbers of people on or just above the minimum. Where are these businesses going to find the money to pay higher wages?
“There’s a danger this will accelerate the decline of the high street and increase the pace of pub closures.”
Listen to Rob discussing the Budget with Graham Poles, tax partner at Armstrong Watson, and the Chamber’s Business Engagement Manager Julian Whittle.