UK Budget 2020 - Boost for Business

In the midst of an uncertain and bumpy economic period, the new Chancellor Rishi Sunak presented a budget which included a £2 billion injection of support for UK businesses.

In advance of the Budget the Bank of England had already cut interest rates from 0.75% to 0.25% taking borrowing costs back to the lowest level in history, and a number of high street lenders had confirmed they would take steps to assist their business customers.

However, on top of this, in an attempt to insulate the economy from the potential impact of the Coronavirus outbreak, Mr Sunak announced a range of measure help the business community over the next few months.

Among the high profile commitments from the Chancellor, business rates will be abolished for firms operating in the retail, leisure and hospital sectors with a rateable value below £51,000.

There will also be a £3,000 cash grant available to any firm currently eligible for small business rates relief.

In addition, a Business Interruption Fund will guarantee loans to businesses of up to £1.2 million.

With the subject of self-isolation high on the agenda, the Chancellor confirmed that firms with 250 staff or fewer will be refunded for sick pay payments for two weeks.

Commenting on the budget the Chancellor said the UK economy was facing a slowdown even before the coronavirus outbreak hit the country.

He added that the OBR had said that the government’s “large planned increase in public investment should boost potential output.”

“More investment and higher growth mean more jobs and higher wages. We already have more people working in our economy than ever before.

Key highlights:

• Business rates abolished for firms in the retail, leisure and hospitality sectors
• Government will refund sick pay payments to businesses with 250 staff or fewer
• Business Interruption Fund to guarantee loans up to £1.2 million
• £600bn set to be spent on infrastructure by 2025
• Extension of Affordable Homes Programme – new multi-year settlement of £12bn
• Cutting interest rate of lending for social housing by 1%