We share some of the best sources of business information relating to the Covid-19 crisis. We also cover Government support for employees, the self-employed and businesses as well as working from home. We hope that you find these resources useful in navigating through these uncertain times.
Helpful resources for small businesses
For small businesses like ourselves, there are some very helpful people out there providing useful, up to date information.
The Institute for Chartered Accountants in England and Wales have written comprehensive guidance and illustrations on furloughing staff and claiming CJRS here as well as a separate Coronavirus page offering practical business advice.
Government support for businesses, employees and the self-employed
Some businesses are thriving, such as supermarkets and of course toilet roll makers, but most are struggling. On 20 March 2020 the Chancellor unveiled a range of measures on an unprecedented scale to support cash-flow for businesses. The Government page with the most up to date information can be found here and details of the schemes here.
The flagship schemes are the Coronavirus Job Retention Scheme (CJRS), the Self-Employment Income Support Scheme (SEISS) and the Coronavirus Business Interruption Loan Scheme (CBILS). We characterise the schemes as the Good, the Bad and the Ugly.
The Good: Coronavirus Job Retention Scheme (CJRS)
Details of the CJRS scheme were published on 26 March 2020. You can find full guidance here.
We think that it is a good scheme. It is wide-ranging and straight-forward to implement. It will help businesses cut costs through the downturn and retain employees to minimise disruption and take advantage when the rebound happens. It is great for employees who would otherwise face redundancy and a very bleak job market.
It is an expensive scheme but needed in our view to get economic wheels turning again when restrictions are lifted. Our concern is that the scheme may only run for three months and if the rebound does not happen quickly then inevitable redundancies are merely being postponed by CJRS.
For an employee perspective, Martin Lewis from MoneySavingExpert made a video with a full explanation of the new furlough scheme. You can also find Government information on benefits at Universal Credit and Employment and Support Allowance.
The Bad: Self-Employment Income Support Scheme (SEISS)
The Chancellor bowed to pressure to introduce this scheme for self-employed workers. A taxable grant worth 80% of average monthly profits over the past three years will be paid as a lump sum in June. See details for self-employed support.
The available benefit is similar to CJRS but the scheme is very narrow. It excludes the newly self-employed, the self-employed earning dividends through a limited company, those earning over £50,000 who now do not have an income and those who do not file tax returns.
Many self-employed people will not get help from this scheme. The Government has changed some of the benefits rules to catch the self-employed in a safety net.
For the sick and self-isolating, employment and support allowance rules have changed to make the equivalent of statutory sick pay available of around £94 per week. The terms of universal credit have also changed for more generous support. You can find more details at Universal Credit and Employment and Support Allowance.
The Ugly: Coronavirus Business Interruption Loan Scheme (CBILS)
Despite the recent modifications we still think that the CBILS is an ugly duckling that will not turn into a swan. The scheme aims to help SME cash flow through bank loans of up to £5 million with the Government guaranteeing 80% of the loan. Loans would not be subject to bank fees or interest for one year.
Although risk shifts dramatically from banks to the Government, it appears that banks are applying the same pre-crisis lending criteria. The banks are still taking 20% risk and will be cautious lending to new credits especially as they are no longer allowed seek personal guarantees for loans less than £250,000. There is no cap on interest rates so rates could end up being unattractive to borrowers.
It remains to be seen but we doubt CBILS will be a realistic source of short-term capital for many businesses to shore up cash flow, especially start-ups, scale-ups and those lacking balance sheet assets.
There may be further schemes to fill gaps. The VC and start-up community are lobbying hard for support with an open letter to Boris Johnson. However, bespoke schemes take longer to implement and sadly may come too late for some businesses.
Working from home
Employers are still responsible for their staff even when they are working from home. Employers should help source and pay for technology solutions and necessary equipment. They are also responsible for data security and making sure that customer data in particular is kept safe.
Savvy tech firms are making the most of home-bound workers to get them hooked on their products. There are plenty of free and low-cost tools to help teams coordinate work and stay in touch remotely. Zoom provides free video-conferencing services. Slack has a suite of office communication tools and is offering many of them for free during the crises. Microsoft is also making many of its small business productivity tools for free for six months, including Teams. Cisco is offering Webex for free and Google also has free productivity tools.
You may need to get additional equipment and office furniture whilst working from home during the outbreak. There are a number of sites where you search online and get office equipment and furniture delivered to your home, including Amazon, Argos and Ikea. In theory, your employer should pick up the bill.
We are always grateful for feedback and suggestions. Please feel free to contact us.
The TidyChoice Team