BCC Coronavirus Survey: cash remains top concern for lockdown-stricken firms across UK

Rating the support from government

When asked to rate the effectiveness of the various government schemes to support their business throughout the crisis, the Coronavirus Job Retention Scheme (CJRS), allowing firms to furlough staff, had by far the highest effectiveness rating. More than two-thirds (68%) using this scheme say that it has been very effective, with a further 28% rating it as somewhat effective. Only 4% said it was not effective.

Other schemes with high effectiveness ratings included Government loan schemes (such as CBILS and BBLS) where 46% rated them ‘very effective’ and 44% rated them ‘somewhat effective’, and the local authority business grant scheme, where 45% rated it ‘very effective’ and 40% rated it ‘somewhat effective’. Business rates relief (49%), VAT deferrals (34%), VAT cuts for certain sectors of the economy (26%) were also rated as very effective.

What firms may do if support expires in March and April

When asked what their business might do if the government support schemes end according to published timetable in March and April, 25% of firms overall said they would ‘make staff redundant’, 25% would ‘reduce staff hours’ and 19% would ‘cancel or reduce investment or recruitment plans’. Only 21% of B2C firms said the expiry of support ‘would have no impact on their business’, compared with 39% of B2B firms and 37% of manufacturers.

Responding to the survey results, BCC Director General Dr Adam Marshall said:

“The last year has taken a heavy toll on businesses across the UK. With cash flow still the top concern, it is vital that the UK government keeps financial support going until firms can reopen and rebuild. Pulling the plug now would be a huge mistake, and would be akin to writing off the billions already spent helping firms to survive.

“Firms are desperate to start trading again so they can boost revenue and start thinking about the future. To do so they need to see a clear, evidence-based plan for reopening, and they need time to get back on their feet without unnecessary additional taxes, and the security of knowing that Government will once again support them should we see additional restrictions imposed at any point.

“In the meantime, support must remain in place for firms that need it until a full reopening of the economy is possible. With cashflow being a major challenge for many businesses, we can expect to see further redundancies or business failures should Government support end prematurely.

“Alongside a clear roadmap for reopening, business confidence will also come from a commitment to further accelerate the vaccination programme and a wider workplace testing strategy that’s accessible to businesses of all sizes.”