Chancellor's Job Support scheme

epm-84

40FTB2020 said:

Using your example of the 3 employees. 

For small business they may have 
employee 1 who works in the finance department, there’s not enough work for full time as not as many customers/suppliers to sort. But still a small amount so some work to do. 

Employee 2 is a sales person. Still a couple of active client accounts but not the full amount. Also some chasing up of leads required in order to secure future business but not enough work for full time. 

Employee 3 is a designer. Does client work but again not enough work at the moment. 

Using that example.  It's unlikely employee 1 is the only person who can make a payment or run an invoice, otherwise what would happen if he/she is on holiday for 2 weeks?  I'd suggest in that example either one of the other 2 people you mention can do finance as well or if not the business owner or accountants that the business use can help when employee 1 is on holiday.  Also unlikely a business will have just one designer at their disposal, it might be they only have one on payroll but they probably have access to others on a freelance basis and if demand decreases they'll be no work to pass on to the freelancers unless employee 3 is on holiday/not working.

epm-84

Galloglass said:

What happens when we run out of free money? Print some more?

By definition, a viable business won't need support as they can exist on existing [lower] cash flow by trimming costs - the unviable jobs. Or by raising capital.

The scheme disrupts the normal banking / financing arrangements where a business would seek bank/equity cash injections based on their prospects. This is designed to protect banks that may have taken a punt in exotic equities or more likely, the mortgage market. 

I think the Chancellor is aware that without any support the number of jobs available will be significantly less than the number of people who want to work, so normally that would result in a large number of people claiming out-of-work benefits.  I think his aim is to try and keep people in part time work with the government topping up their wages, rather than them having no work and the government providing all their income (as is the case with full time furlough or those solely living on UC.)  Whether it'll work is a different question.

Thrugelmir

Galloglass said:

The scheme disrupts the normal banking / financing arrangements where a business would seek bank/equity cash injections based on their prospects. This is designed to protect banks that may have taken a punt in exotic equities or more likely, the mortgage market. 

Banks don't take punts. Companies will still require finance in the form of loans, overdrafts, factoring, invoice discounting to continue their normal activities. The world of commerce hasn't actually stopped. 

Tammykitty

gary83 said:

Tammykitty said:

Thrugelmir said:

Tammykitty said:

This is crazy - the scheme should be spilt into different sectors now:

1)Those operating as normal or who actually have increased businesses
2)Those operating to some degree of normality - this scheme works well for these
3) Industries which are open with serious restrictions/drop in incomes
Domestic Trades and any business that involves going into peoples homes
Pubs 
Taxi
4)Those which are still not allowed to operate to any proper degree:
Wedding & Events
Entertainment
Nightclubs


Obviously, the affected industries would need to be looked at, and a robust list drawn up

Such a concept is crazy.  

What is crazy is not providing support for industries that are not allowed to open or operate!
The new scheme is only supporting large businesses if their income has fallen - its not difficult to operate tailored schemes.
The self employed already have an industry listed on their tax returns - this could easily be used to tailor a scheme for a them.

We’re 6 months into this pandemic affecting the UK and theres not much sign of things improving anytime soon so for how long should we tailor support to businesses that are no longer viable? 9 months? 12 months? 18 months? 2 years? 3 years?

Personally - I think what we do, is let all businesses open with whatever restrictions necessary. 
What should a nightclubber owner do now - he can't pay his staff with no income - he can't sell, because no one will buy. He had a very profitable business before covid, and will have a viable business after covid, but needs support to stop the business going bankrupt in the meantime. He can't afford to pay his staff, can't afford to make them redundant either - he is going bankrupt through no fault of his own whatsoever. The government either need to give these businesses an opportunity to open or continue to support them. 
Businesses which are still not legally allowed (or allowed to open with serious restrictions - such as wedding and event related businesses) to open are completely different from those which are suffering due to lack of consumer confidence, recession etc.

It is all very well saying how long do we support them - for however long we don't allow them to open is the answer!

Its all very well saying let them close, but say we go don't allow tradesmen to do anything other than essential maintenance, without support they will close down their business and try and get a different job or rely fully on benefits, what happens then when people need emergency plumbers, emergency electricians etc, and they can't get one.... Some industries are essential and not necessarily viable given current restrictions

Grumpy_chap

Tammykitty said:

Personally - I think what we do, is let all businesses open with whatever restrictions necessary. 
What should a nightclubber owner do now
Businesses which are still not legally allowed (or allowed to open with serious restrictions - such as wedding and event related businesses) to open are completely different from those which are suffering due to lack of consumer confidence, recession etc.

It is all very well saying how long do we support them - for however long we don't allow them to open is the answer!

To support businesses that are not permitted to trade "for however long" is a perfectly valid answer, but I would like to understand whether there are any limits at all to how you interpret "for however long".
This lockdown has already been 6 months and the latest batch of support runs for the next 6 months.  (Not sure whether this latest batch of support offers much to a nightclub owner.)  That will take us to a year long event.
Would you continue to provide support for another year after that (total 2 years)?
Another 5 years?

What duty is there on the business owner to adapt, as other businesses have in some way also?  Yes, that may mean the nightclub operating as a bar or restaurant in the current period, or a less "active" form of entertainment - a venue local to me is resuming their stand-up nights, for example.  It is likely to be a very long time before nightclubs can return to "normal" and some alternative form of economic progression is probably the only way for these businesses to be viable.  It is probably not practicable or desireable to just subsidise them "for however long" as vacant premises with employees left "idle" but salaried.

daveyjp

Grumpy_chap said:i

Tammykitty said:

Personally - I think what we do, is let all businesses open with whatever restrictions necessary. 
What should a nightclubber owner do now
Businesses which are still not legally allowed (or allowed to open with serious restrictions - such as wedding and event related businesses) to open are completely different from those which are suffering due to lack of consumer confidence, recession etc.

It is all very well saying how long do we support them - for however long we don't allow them to open is the answer!

To support businesses that are not permitted to trade "for however long" is a perfectly valid answer, but I would like to understand whether there are any limits at all to how you interpret "for however long".
This lockdown has already been 6 months and the latest batch of support runs for the next 6 months.  (Not sure whether this latest batch of support offers much to a nightclub owner.)  That will take us to a year long event.
Would you continue to provide support for another year after that (total 2 years)?
Another 5 years?

What duty is there on the business owner to adapt, as other businesses have in some way also?  Yes, that may mean the nightclub operating as a bar or restaurant in the current period, or a less "active" form of entertainment - a venue local to me is resuming their stand-up nights, for example.  It is likely to be a very long time before nightclubs can return to "normal" and some alternative form of economic progression is probably the only way for these businesses to be viable.  It is probably not practicable or desireable to just subsidise them "for however long" as vacant premises with employees left "idle" but salaried.

If Government took the decision to pay more to people running business they are forcing to close due to their major failures it may focus their minds on getting a test, track, trace and isolate system in place which actually works.

It is far easier and cheaper for them to remove the support system completely as admitting failure is a sign of weakness.

The Government's lack of action could see the closure of every nightclub, every sports club and venue below possibly the top tier of football, every theatre, every arena, every live venue, every wedding venue and thousands of bars and restaurants.

They either haven't realised this or are happy to see the leisure sector be the fall guy.

Thrugelmir

daveyjp said:

Grumpy_chap said:i

Tammykitty said:

Personally - I think what we do, is let all businesses open with whatever restrictions necessary. 
What should a nightclubber owner do now
Businesses which are still not legally allowed (or allowed to open with serious restrictions - such as wedding and event related businesses) to open are completely different from those which are suffering due to lack of consumer confidence, recession etc.

It is all very well saying how long do we support them - for however long we don't allow them to open is the answer!

To support businesses that are not permitted to trade "for however long" is a perfectly valid answer, but I would like to understand whether there are any limits at all to how you interpret "for however long".
This lockdown has already been 6 months and the latest batch of support runs for the next 6 months.  (Not sure whether this latest batch of support offers much to a nightclub owner.)  That will take us to a year long event.
Would you continue to provide support for another year after that (total 2 years)?
Another 5 years?

What duty is there on the business owner to adapt, as other businesses have in some way also?  Yes, that may mean the nightclub operating as a bar or restaurant in the current period, or a less "active" form of entertainment - a venue local to me is resuming their stand-up nights, for example.  It is likely to be a very long time before nightclubs can return to "normal" and some alternative form of economic progression is probably the only way for these businesses to be viable.  It is probably not practicable or desireable to just subsidise them "for however long" as vacant premises with employees left "idle" but salaried.

If Government took the decision to pay more to people running business they are forcing to close due to their major failures it may focus their minds on getting a test, track, trace and isolate system in place which actually works.

That Labour line is wearing thin. Too many visible Covidiots in this country.  That includes people running businesses. 

[Deleted User]

daveyjp said:

Grumpy_chap said:i

Tammykitty said:

Personally - I think what we do, is let all businesses open with whatever restrictions necessary. 
What should a nightclubber owner do now
Businesses which are still not legally allowed (or allowed to open with serious restrictions - such as wedding and event related businesses) to open are completely different from those which are suffering due to lack of consumer confidence, recession etc.

It is all very well saying how long do we support them - for however long we don't allow them to open is the answer!

To support businesses that are not permitted to trade "for however long" is a perfectly valid answer, but I would like to understand whether there are any limits at all to how you interpret "for however long".
This lockdown has already been 6 months and the latest batch of support runs for the next 6 months.  (Not sure whether this latest batch of support offers much to a nightclub owner.)  That will take us to a year long event.
Would you continue to provide support for another year after that (total 2 years)?
Another 5 years?

What duty is there on the business owner to adapt, as other businesses have in some way also?  Yes, that may mean the nightclub operating as a bar or restaurant in the current period, or a less "active" form of entertainment - a venue local to me is resuming their stand-up nights, for example.  It is likely to be a very long time before nightclubs can return to "normal" and some alternative form of economic progression is probably the only way for these businesses to be viable.  It is probably not practicable or desireable to just subsidise them "for however long" as vacant premises with employees left "idle" but salaried.

If Government took the decision to pay more to people running business they are forcing to close due to their major failures it may focus their minds on getting a test, track, trace and isolate system in place which actually works.

It is far easier and cheaper for them to remove the support system completely as admitting failure is a sign of weakness.

The Government's lack of action could see the closure of every nightclub, every sports club and venue below possibly the top tier of football, every theatre, every arena, every live venue, every wedding venue and thousands of bars and restaurants.

They either haven't realised this or are happy to see the leisure sector be the fall guy.

The government have definitely failed a lot of industries but I think some people have refused to adapt or accept that things won’t be the same as before, ie are expecting to get support to ‘tide over’ until they can reopen as before, which might never happen. 

Re: sports clubs, I don’t know if this counts as I don’t do any other sports, but the dance studio I attend moved online during lockdown. The instructors, who are predominately freelance, worked with the studio, doing exercise videos that were specific to disciplines, with tiered options for membership. The owner put these things up quickly (the studio was open right up to forced closure before national lockdown) and was able to pay the instructors during lockdown and keep the business going. They’ve been allowed to open, but it’s not the same. The capacity is a lot less (like working at 50% or less), so pricing and timetables have changed to reflect that and using available spaces in different ways etc. Businesses legally allowed to open are continuing to adapt, and probably take less profit,  to keep the business afloat. Even if nightclubs were allowed to open, they would have to adapt for social distancing, so cannot expect the same business model as before.

epm-84

daveyjp said:

Grumpy_chap said:i

Tammykitty said:

Personally - I think what we do, is let all businesses open with whatever restrictions necessary. 
What should a nightclubber owner do now
Businesses which are still not legally allowed (or allowed to open with serious restrictions - such as wedding and event related businesses) to open are completely different from those which are suffering due to lack of consumer confidence, recession etc.

It is all very well saying how long do we support them - for however long we don't allow them to open is the answer!

To support businesses that are not permitted to trade "for however long" is a perfectly valid answer, but I would like to understand whether there are any limits at all to how you interpret "for however long".
This lockdown has already been 6 months and the latest batch of support runs for the next 6 months.  (Not sure whether this latest batch of support offers much to a nightclub owner.)  That will take us to a year long event.
Would you continue to provide support for another year after that (total 2 years)?
Another 5 years?

What duty is there on the business owner to adapt, as other businesses have in some way also?  Yes, that may mean the nightclub operating as a bar or restaurant in the current period, or a less "active" form of entertainment - a venue local to me is resuming their stand-up nights, for example.  It is likely to be a very long time before nightclubs can return to "normal" and some alternative form of economic progression is probably the only way for these businesses to be viable.  It is probably not practicable or desireable to just subsidise them "for however long" as vacant premises with employees left "idle" but salaried.

The Government's lack of action could see the closure of every nightclub, every sports club and venue below possibly the top tier of football, every theatre, every arena, every live venue, every wedding venue and thousands of bars and restaurants.

I think the Chancellor believes bars and restaurants are the kind of business which benefit from his new scheme.  For example, if you are a restaurant and you normally close at 11pm and your staff finish half an hour after closing then you might want to shorten the shifts of some of your staff by one hour, which is something you can do with the new scheme without it costing the business a fortune to do so.  If on the other hand you work in the check in area in an airport then it might be the times of the first and last flights haven't changed but the number of staff currently required is significantly reduced due to the number of flights being reduced it's a different matter and unfortunately it will likely mean job losses now and recruitment for new members of staff in 12-24 months time.

Tammykitty

ftbhopes said:

daveyjp said:

Grumpy_chap said:i

Tammykitty said:

Personally - I think what we do, is let all businesses open with whatever restrictions necessary. 
What should a nightclubber owner do now
Businesses which are still not legally allowed (or allowed to open with serious restrictions - such as wedding and event related businesses) to open are completely different from those which are suffering due to lack of consumer confidence, recession etc.

It is all very well saying how long do we support them - for however long we don't allow them to open is the answer!

To support businesses that are not permitted to trade "for however long" is a perfectly valid answer, but I would like to understand whether there are any limits at all to how you interpret "for however long".
This lockdown has already been 6 months and the latest batch of support runs for the next 6 months.  (Not sure whether this latest batch of support offers much to a nightclub owner.)  That will take us to a year long event.
Would you continue to provide support for another year after that (total 2 years)?
Another 5 years?

What duty is there on the business owner to adapt, as other businesses have in some way also?  Yes, that may mean the nightclub operating as a bar or restaurant in the current period, or a less "active" form of entertainment - a venue local to me is resuming their stand-up nights, for example.  It is likely to be a very long time before nightclubs can return to "normal" and some alternative form of economic progression is probably the only way for these businesses to be viable.  It is probably not practicable or desireable to just subsidise them "for however long" as vacant premises with employees left "idle" but salaried.

If Government took the decision to pay more to people running business they are forcing to close due to their major failures it may focus their minds on getting a test, track, trace and isolate system in place which actually works.

It is far easier and cheaper for them to remove the support system completely as admitting failure is a sign of weakness.

The Government's lack of action could see the closure of every nightclub, every sports club and venue below possibly the top tier of football, every theatre, every arena, every live venue, every wedding venue and thousands of bars and restaurants.

They either haven't realised this or are happy to see the leisure sector be the fall guy.

The government have definitely failed a lot of industries but I think some people have refused to adapt or accept that things won’t be the same as before, ie are expecting to get support to ‘tide over’ until they can reopen as before, which might never happen. 

Re: sports clubs, I don’t know if this counts as I don’t do any other sports, but the dance studio I attend moved online during lockdown. The instructors, who are predominately freelance, worked with the studio, doing exercise videos that were specific to disciplines, with tiered options for membership. The owner put these things up quickly (the studio was open right up to forced closure before national lockdown) and was able to pay the instructors during lockdown and keep the business going. They’ve been allowed to open, but it’s not the same. The capacity is a lot less (like working at 50% or less), so pricing and timetables have changed to reflect that and using available spaces in different ways etc. Businesses legally allowed to open are continuing to adapt, and probably take less profit,  to keep the business afloat. Even if nightclubs were allowed to open, they would have to adapt for social distancing, so cannot expect the same business model as before.

Sports clubs also include your local rugby club, (Or in my case GAA (Irish Football) club - these businesses rely on gate receipts and if they can't have spectators, they can't make money, many are trying things like running draws, auctions etc to make money, but its not the same.
Even the elite sports, need gate receipts, TV rights don't pay for everything.

How long is too long to support a business - is the real question not how long is too long to be "lockdown" - if we still don't have a vaccine this time next year, we need to live with covid and adapt to it, legal restrictions can't last that long - by all means voluntarily remain shut, but these things can't be mandated forever.

Nothing should face mandatory closure without financial support - and while the government rules are still for mandatory closures, there needs to still be support - however long that takes.

Or do you want a world with no local sports clubs, no night clubs, no live music, no wedding or conference venues - these things need to be able to reopen after covid - it will be over someday, and we need a society to go back too. How can airlines adapt - or do we just let the airlines fail, and no international travel is allowed?

Yes, businesses need to take some responsibility to adapt, but only if possible. In some areas restrictions are still in place, meaning even stand up comedy wouldn't be allowed. And if businesses have no money, how can they afford to adapt? That's the other problem with the chancellors schemes - there is no recognition that different parts of the UK have different legislations.

A local festival near me was cancelled as expected, they made plans and spent money to change it to a social distance festival, the council still didn't approve it.

So it's not simply financial support that should be provided, what is needed is a dedicated team to help businesses adapt - ideas on how to change things to a covid acceptable business - provide practical help too

What is also needed is a track and trace system that works - we can't have businesses closing down constantly due to lack of testing, staff member has symptons, they and their household need to self isolate until they can get a test, can take days, and that could be 4+ people not at work for days.

There is no easy answer to this, the government can't support businesses forever, but the restrictions can't last forever either...