The Confederation of British Industry (CBI) has called on the UK government to provide more than £7 billion of extra relief to struggling UK businesses.
The CBI said that Chancellor Rishi Sunak should extend until June his broad job retention scheme, which is scheduled to expire in April, and then follow it up with targeted support for jobs in sectors facing a slow recovery such as aviation.
He should also give firms more time to pay back value-added tax which was deferred last year, grant a similar deferral for early 2021 and extend a business rates tax exemption for companies forced to close by the lockdown as well as their suppliers.
With Britain back under lockdown and companies adjusting to life after Brexit, firms are taking important decisions about jobs and investment and need to know if their financial lifelines will be extended, the CBI said.
“We just have to finish the job. Now would be a very odd time to end that support,” CBI director-general Tony Danker (above) said in a statement.
Sunak has extended his support measures several times already and has said his response to the pandemic will cost £280 billion during the current financial year.
However, he is facing calls on many fronts to spend yet more including from lawmakers, some from his Conservative Party, who want an emergency welfare benefit increase to be prolonged.
“The rule of thumb must be that business support remains in parallel to restrictions and that those measures do not come to a sudden stop,” Danker said.
The CBI said its longer-term priority was an overhaul of the business rates system that it said was outdated and discouraging investment in low-carbon energy.