GNF Members Update 4 May -
Today we start with the extremely welcome news that, as we expected, the Government has announced financial support for small businesses which are not eligible for previous grants. We’re also aware that although t
he Government was due to formally review lockdown measures on Thursday, May 7 the Prime Minister is now expected to unveil a roadmap out of lockdown on Sunday, 10 May.
£617m Additional Fund to support small Council Taxpaying businesses
On Saturday, the Government announced a new discretionary fund for small businesses previously outside the scope of the business grant funds scheme.
This additional fund is aimed at small businesses such as Bed & Breakfasts that pay council tax rather than business rates. Businesses must be small, under 50 employees, and must also be able to demonstrate that they have seen a significant drop of income due to coronavirus restriction measures.
There will be three levels of grant payments. The maximum will be £25,000, with other grants of £10,000 available. Local authorities will have discretion to make payments of any amount under £10,000. New Forest District Council will administer the scheme but are awaiting the full details and criteria from the Treasury against which they will operate the fund. NFDC say they have been preparing for this new grant and hope to provide full application details shortly.
FCA Seeks Legal Clarity on Business Interruption Insurance
The Financial Conduct Authority has announced it intends to seek legal clarity on business interruption insurance to resolve doubt for businesses who are facing uncertainty on their claims. At the same time it is also producing new guidance for insurance firms, expecting them to consider whether and how coronavirus may have materially affected the value of their insurance products. The effects of coronavirus may mean that:
- Firms are no longer able to provide expected contractual benefits, either in the expected form, to the expected timeframe, or at all. For example, where fulfilling claims involves service providers whose movements are restricted because of lockdown (e.g. boiler servicing), or some medical covers where customers cannot access certain benefits.
- Underlying insured events can no longer happen for any holders of the policy eg, due to Government lockdown or other circumstances connected with coronavirus, resulting in a fundamental change in risk for the firm. For example, public liability insurances for businesses that are unable to open, such as hairdressers, bars and restaurants.
As we await Sunday’s review of the lockdown and GNF starts to finalise its initial destination Recovery Plan, our thoughts naturally turn evermore towards the operational implications of re-opening. Social distancing in particular will provide a significant barrier to the viability of a number of our different types, models and scales of member business. It is absolutely vital that we develop a very clear picture of the impact and implications of these issues. We need to identify the businesses that are fit and able to re-open as soon as travel restrictions are lifted and those which will require a longer term re-adjustment and ongoing financial assistance, some maybe right through to Spring 2021.
Over the coming weeks and months it is important we build a plan which takes all this into account and provides us with the insight to deliver what, by nature, will be a complex and variable programme of lobbying, collective action and public support. Starting with GNF’s Hotels Group Zoom meeting on Wednesday, we need to sketch out and build up that big picture. Only with this overview can we create a realistic, safe and sensible plan which is supported by everyone here in the forest, regionally and nationally.
Comprehensive member support for the plan will be absolutely vital if we are to avoid any backward steps, maximise opportunity and all be in a position to fully embrace the “new normal” as soon as possible. We look forward to hearing what you think during the next round of GNF sector group zoom meetings over the next 10 days.
With best wishes,