COVID-19

COVID-19: Weekly UK Public Affairs Round-up

More funds for the UK’s Vaccine Taskforce may mean more security for the vaccination programme this week as the Government ramps up the UK’s defences against future variants. Meanwhile, with transmission rates across the UK continuing to fall, the 30-person cap on funerals has been scrapped as the public look forward to further lockdown easing from 17th May.

Booster for the Vaccine Taskforce

5th May: On Wednesday, the Government announced that it will invest £29.3 million through the Vaccines Taskforce in new testing facilities to fast-track COVID-19 variant vaccines this week. Health Secretary Matt Hancock said that this latest boost to the vaccines taskforce will “future-proof” the country from the possibility that new variants could derail the UK’s much lauded vaccination programme. With an increase in capacity at Public Health England’s new labs in Porton Down from 700 to 3,000 blood samples tested a week, the UK is bolstering its defences as the public look forward to the next stage of lockdown easing in a mere ten days.

Meanwhile, Vaccines Minister Nadhim Zahawi has said that booster jabs will be ready to deploy in the UK from September. This comes as deaths attributed to COVID-19 across the UK plummeted by 48% in the last week. These are positive trends, backed up by the judgement of Professor Neil Ferguson, engineer of the first nationwide restrictions, that another lockdown is “unlikely” to take place in the UK. For the Government, this is clearly a scenario worth investing in.

A fresh approach to contact tracing

2nd May: A new 40,000 person daily contact testing study was launched in the UK this week, which aims to increase understanding of how effective daily contact testing could be for people who are contacts of positive COVID-19 cases. Following another study suggesting that few people fully obeyed the call to isolate after being contacted by the NHS Test and Trace app, it is hoped that mass testing could tick all boxes, preventing the spread of COVID-19 whilst doing away with the inconvenience of self-isolation. As society opens up further, this is likely to be a move welcomed by the public, as social and work commitments undoubtedly increase as lockdowns ease.

Mixed news in the devolved nations

At the same time as England, Scotland is also due to move to level two of its lockdown easing plan on 17th May, however Public Health Officials have warned that the council area of Moray is experiencing "uncontrolled, sustained community transmission", an anomaly the Scottish Government will hope is quickly rectified. Describing the situation as “very fragile”, Head of Health Intelligence at NHS Grampian, Jillian Evans warned that level three restrictions could remain in place in Moray if infection rates do not reduce.

30th April: There was more positive news from the Welsh Government, who completed its move down to Alert Level 3 on Monday this week. People in Wales can once more hit the gym or go for swim and two households can form an exclusive bubble to meet and have contact indoors. Other measures include the reopening of organised children’s indoor activities and organised indoor activities for adults for up to 15 people. The next review of restrictions in Wales is due next Thursday.

Other News

3rd May: The government has announced that the legal limit of 30 mourners will be removed as part of step three of the UK’s roadmap, to take place from 17th May at the earliest. This follows recent data which does not suggest any need to alter the dates at which restrictions will next be eased. The new guidelines will set out that the number of people who can attend a funeral will be determined by how many people the venue can safely accommodate with social distancing, including in indoor and outdoor spaces.

Covid-19 Statistics

Daily Last 7 days Rate per 100k resident population
Positive Cases 2,613 14,311 (-9.5%) 22.1
Deaths 13 81 (-48.4%) 0.1

Summary of UK COVID-19 Business support schemes

The following rolling list of UK government business support measures announced in response to the Covid-19 pandemic is updated weekly and is accurate as of Thursday 6th May 2021.

The UK Government has implemented a series of economic interventions aimed at supporting employees, employers and businesses through the uncertainty and potential loss of income resulting from the Covid-19 pandemic. Some have been revised and extended since being announced.

There is an official web portal with details on eligibility and how businesses can apply.

Employment retention measures

Coronavirus Job Retention Scheme: Since March 2020, employers have been able to claim 80% of their usual monthly wage costs for furloughed employees, limited to £2,500 per individual per month, in addition to the associated Employer National Insurance and minimum automatic enrolment employer pension contributions. Furloughed workers are able to work part-time, with employers sharing salary costs with the Government and covering National Insurance and pension contributions. To qualify for furlough payments, employees must have been on the payroll from 30th October 2020. The scheme will run until 30 September 2021 with employees receiving 80% of their pay for the entire period. Employers will be asked to contribute towards the cost of furloughed employees’ wages from July, paying 10% of the cost in the first month and then 20% across August and September. Claims for furlough days in March 2021 must be made by 14 April 2021. Claims for furlough days in April 2021 must be made by 14 May 2021.

Jobs Retention Bonus: The Job Retention Bonus is a £1,000 one-off taxable payment to employers for each eligible employee who was furloughed and kept continuously employed until 31st January 2021. Employers are able to claim the bonus between 15th February 2021 and March 31st 2021. There will not be an additional bonus for employers who keep employing beyond 31st January 2021.

Coronavirus Statutory Sick Pay Rebate Scheme: The Government will refund eligible Statutory Sick Pay costs to all employers with fewer than 250 employees. This applies to any claim arising as a result of Covid-19, including precautionary self-isolation and those advised to shield due to clinical vulnerabilities. Employers are able to ask employees for a “shielding note” from a doctor or health authority advising them to shield. The scheme is limited to two weeks per employee.

Self-Employment Income Support Scheme (SEISS): Grants have been made available for those with trading profits of less than £50,000 that have experienced a loss of earnings due to Covid. To qualify at least half of a claimants income must come from self-employment. Three grants have already been paid out with applications currently closed. A fourth and fifth grant were confirmed at the March Budget. Applications for the fourth grant will open in late April and will cover 80% of 3 months’ average trading profits capped at £7,500. If claimants are eligible based on their tax returns, HMRC will make contact in mid-April to provide a date from which a claim can be made. The fourth grant must be claimed on or before 1 June 2021. The fifth grant, available from late July, will apply predominantly to those most affected by the pandemic with 80% grants only available to those who have seen a turnover reduction of 30% or more. The fourth grant, which covers 1 February 2021 to 30 April 2021, is now available.

Self-isolation Low Income Payment: To support individuals during self-isolation, a £500 Test and Trace Support Payment is available to those who will lose income or face financial hardship as a result of self-isolating. Those on, or living with a partner on, a range of Government benefits are also eligible for the payment. Applications for payment can be made through local councils. Payments are subject to income tax but not National Insurance contributions. Parents or guardians of a child who has been told to self-isolate may also qualify for the payment if they cannot work from home.

Business disruption financing measures

Coronavirus Commercial Financing Facility: The Bank of England’s commercial financing facility is designed to support large companies of investment grade standing, allowing qualifying businesses to issue short-term debt of up to one-year maturity, which will be purchased by the Bank of England. It will operate until at least 20th March 2021 and for as long as steps are needed to relieve cash flow pressure on firms.

Bank of England Term Funding Scheme: The Term Funding Scheme offers four-year funding of at least 10% of participants’ stock at interest rates at, or very close to, Bank Rate. Drawdowns on the scheme will run until 30th April 2021.

Coronavirus Large Business Interruption Loan Scheme: This scheme was intended to provide otherwise viable companies with access to short-term liquidity. It provides financing of up to £200m in the form of loans, overdrafts, or invoice and asset finance to businesses with an annual turnover of between £45m and £500m. Lending is for a maximum of three years. Individual lending limits apply and will be determined and administered using the existing Enterprise Finance Guarantee. There are 40 accredited institutions, including all major high-street banks. To incentivise them to lend, the Government – through the British Business Bank - is guaranteeing 80% of the value of a loan. Companies that borrow over £50 million through the scheme will be subject to restrictions on dividend payments, senior pay and share buy-backs. The application deadline for the scheme was 31st March 2021, and the guidance was withdrawn on 1 April 2021.

Coronavirus Business Interruption Loan Scheme: Sharing similar characteristics to the Large Business Interruption Loan Scheme, financing of up to £5m was made available to those with an annual turnover of less than £45m. Lending is also extended, to a maximum of six years and the Government is paying the first 12 months’ interest. As of 30th November, there are 117 lenders participating in the scheme, including all main retail banks. The application deadline for the scheme was 31st March 2021, and the guidance was withdrawn on 1 April 2021.

Bounce Back Loan Scheme: Bounce Back Loans were introduced in April 2020 to give small businesses fast access to loans of between £2,000 and £50,000. Loans were made available through accredited lenders with the Government acting as guarantor and paying interest for the first 12 months on all loans. Firms are to begin repayments within 12 months. On 8th February, the Treasury announced that those with bounce-back loans are to be granted extra flexibility with repayments. Loans can now be extended with payment schedules altered to a company’s specific needs. Additionally, all payments can be delayed for a further 6 months meaning that for some, the first payment is now due 18 months after taking out the loan.

Trade Credit Insurance Guarantee: Businesses with supply chains that are reliant on Trade Credit Insurance may apply for support from the Government. The Government will temporarily guarantee business-to-business transactions currently supported by Trade Credit Insurance, ensuring that the majority of insurance coverage will be maintained across the market. The Trade Credit Insurance (TCI) guarantee will cover over £171 billion of business activity currently insured and the transactions between around 13,000 suppliers and 650,000 buyers.

Restart Grant Scheme: Available from 1 April, the Restart Grant is designed to assist non-essential retail and the hospitality and leisure sectors as they reopen. Non-essential retail businesses will be entitled to a one-off grant of up to £6,000 per premises while hospitality and leisure operations will be entitled to a grant of up to £18,000. The £5 billion of government funding available through the Restart Grants scheme will be delivered by local authorities.

Recovery Loan Scheme: The Recovery Loan Scheme ensures businesses of any size can continue to access loans and other kinds of finance up to £10 million per business once the existing COVID-19 loan schemes close. The finance can be used for any legitimate business purpose, including growth and investment. The Government will guarantee 80% of the finance to the lender. The scheme launched on 6th April and is open until 31st December, subject to review. Loans will be available through a network of accredited lenders, whose names will be made public in due course.

Tax relief measures

Temporary VAT reduction for hospitality sector: The Government has introduced a temporarily reduced VAT rate of 5%, down from 20%, for certain supplies of hospitality, hotel and holiday accommodation, and admissions to certain attractions. The reduction will last until 30th September at which point an interim rate of 12.5% will be in place until April 2022.

VAT Deferral: Those who deferred VAT payments due between 20th March 2020 and 30th June 2020 can pay the deferred amount in full by 31st March 2021 or join a VAT deferral payment scheme, paying in smaller amounts over a longer period of time. On 9th February a new VAT deferral payment scheme was set up to help businesses pay their deferred VAT. The scheme, which opened on the 23rd February and is set to run until 21st June, will allow companies to pay their deferred VAT in equal interest-free instalments. Companies can choose how many instalments they wish for payments to be divided over with eleven the maximum number. Upon joining the scheme firms must pay their first instalment. Those already on existing VAT repayment programmes will be invited to join the new payment system from 10th March 2021. Companies may be charged a 5% penalty or interest if they do not pay in full or make an arrangement to pay by 30 June 2021.

Support for Businesses Paying Tax: HMRC have established a dedicated Covid-19 helpline to support businesses and self-employed individuals unable to meet tax demands. Bespoke Time to Pay arrangements will be offered to those businesses with a legitimate need and support their recovery while navigating any temporary financial challenges. HMRC will also waive late payment penalties and interest where a business experiences administrative difficulty due to Covid-19.

Targeted support measures

Apprentice and Trainee Bonus Scheme: Cash bonuses of up to £3,000 per apprentice will be available to employers that hire apprentices between April and September in 2021. This is in addition to the existing £1,000 that employers receive for taking on each new apprentice aged 16-18 or those aged under 25 with an Education, Health and Care Plan. Businesses can apply for incentive payments for these apprentices from 1 June 2021 to 30 November 2021.

Local Restriction Support Grant: This grant was available for businesses that were open as usual before being required to close with the implementation of national restrictions from the 5th January 2021 onwards. Grants are based on the rateable value of the property on the first day of restrictions. Businesses with a rateable value of £51,000 or above are eligible for a cash grant of £4,500 for each 42-day qualifying period. Grants will be paid by local councils while national restrictions remain. The Local Restrictions Support Grants closed to new applications on 31 March 2021 and any business which haven’t received their payment by 30 April 2021 should contact their local council.

Cash Grant for Retail, Hospitality and Leisure under Local restrictions: The Government will provide funding to local authorities to provide cash grants of up to £2,100 per month, for businesses in the hospitality, accommodation and leisure sector adversely affected by regional restrictions. These grants are available retrospectively from August, and will be administered by local authorities.

Business Rates Holiday for Retail/Hospitality/Leisure venues/Nurseries: A 100% business rates holiday will be in place until June 31st at which point a temporary rate, equivalent to one third of the normal charge will be in place until the end of 2021. Non-financial measures

Business Support Checker Tool: The UK Government have released a “support find tool” in the form of a self-assessed questionnaire for businesses and self-employed people across the UK, to allow them to quickly determine what financial support is available to them.

Coronavirus Business Support Hub: Businesses can access a new online portal which aims to compile “key information for businesses including on funding and support, business closures, responsibilities as an employer and managing your business during coronavirus. The hub also includes information for self-employed people and sole traders.”

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