The Government is being urged to accelerate the roll-out of business support measures in response to the coronavirus after a survey in Cornwall and the Isles of Scilly found that 40% of businesses said they may not last another month.
The survey, which is ongoing, has been commissioned by the Cornwall & Isles of Scilly Local Enterprise Partnership (LEP) and was launched earlier this week in partnership with the Cornwall and Isles of Scilly Growth Hub, Cornwall Council, Cornwall Chamber of Commerce and the Federation of Small Businesses.
Ninety percent of respondents said coronavirus has had a ‘significant’ impact on their business, with none unaffected by the outbreak.
Three-quarters are reporting cashflow issues, with 88% saying they have seen reduced demand for products and services. More than a quarter have already laid of staff, at an average of five per business.
Almost 90% of respondents said their business will not survive more than six months if current restrictions continue, and 40% said they may not last a month.
Businesses said the most urgent requirements at this time are cash grants, support for wages and deferred payment of taxes like VAT and PAYE. Another priority was access to information about the help available.
Mark Duddridge, Chair of the Cornwall and Isles of Scilly Local Enterprise Partnership, said: “Businesses are on the precipice and for many there is no safety net without Government support.
“The Government’s interventions are unprecedented and very welcome, but we are urging the Treasury to make the promised cash available to local authorities right now so that grants can be paid. And we need urgent clarity from HMRC about how the Job Retention Scheme will operate before tens of thousands of jobs are lost in our economy.
“Businesses are reluctant to take on debt in the current climate and many are worried about deferring VAT and PAYE because they fear a tax bombshell next year. We need maximum flexibility from lenders and HMRC so those obstacles can be overcome. And we need to be looking longer term. Many tourism businesses are telling us they may not survive the winter if the current season is entirely lost.”
To help businesses deal with the impact of COVID-19, the LEP and Cornwall Council have increased the capacity of the Cornwall and Isles of Scilly Growth Hub to help businesses navigate the range of support available to them.
Businesses are urged to visit the Growth Hub website, which is regularly updated with the latest information, or call 01209-708660 during office hours. The service is free.
Mark added: “It’s important that where possible businesses keep talking to their trade bodies and member organisations like the Chamber of Commerce and FSB about COVID-19 impact, and the Growth Hub is the place to go for up to date information.”
The business impact survey was launched online on Wednesday and had received 182 responses by Friday (March 27) morning. It will be kept open for the foreseeable future and any business wishing to fill it out can follow this link.
The results are being fed back directly to Government by the LEP to help shape ongoing business support activity.
Key findings include:
- 90% of businesses said coronavirus has had a ‘significant’ impact on their business. None of the respondents was unaffected.
- 88% reported reduced demand for products and services, with 74% reporting cashflow issues.
- 90% of respondents said their business will not survive more than six months if current restrictions continue. 40% said they may not last a month.
- Half of all businesses have reduced their hours of operation. One in five have put staff on short time working and 28% have laid off staff.
- Across all respondents to the survey, 345 staff have been laid off and 217 have been put on reduced hours.
- The most helpful thing for businesses at this time would be cash grants, support for wages and deferred payments of taxes like VAT and PAYE.
Another priority was access to information about the help available.
- 77% of businesses plan to access loans and grants that the Government is providing to help them cope.
- 52% plan to use HMRC’s Time to Pay scheme to defer tax payments.
- Two thirds of respondents were micro-businesses employing less than five people. One third were sole traders.
Businesses impacted span all sectors, including hospitality, leisure, wholesale, retail, construction, manufacturing, software, automotive, marketing, IT, electrical, marine, beauty, farming, training, consultancy, plumbing, telecoms, engineering, recruitment, estate agents, gaming, renewable energy and machinery.
Many small businesses said they were holding out for grants that have been promised by the Government, which will be paid by local authorities once they receive the funding from the Treasury, which is expected in early April. These range from £10,000 to £25,000 depending on circumstances, and are expected to benefit over 25,000 business in Cornwall alone.
Businesses in Cornwall and the Isles of Scilly that need help to understand what support is available to deal with the impacts of COVID-19 are urged to contact the Cornwall & Isles of Scilly Growth Hub.