The chancellor of the Exchequer has announced at least £330 billion in government-assured loans to keep businesses afloat and employees paid as well as three-month mortgage holidays for borrowers in need.
Rishi Sunak revealed the next government financial intervention for coronavirus at a press conference alongside Prime Minister Boris Johnson and chief medical adviser Sir Patrick Vallance from Downing Street on Tuesday.
“I will strengthen our support for people,” Mr Sunak said, outlining: “Following discussion with the industry today, I can announce that those in difficulty due to coronavirus, mortgage lenders will now offer a three-month mortgage holiday so people will not have to pay a penny in mortgage costs while they get back on their feet.”
Mr Sunak also unveiled support for businesses, saying: “Today I am making available an additional £330 billion of guarantees — equivalent to 15 per cent of our GDP.
“That means any business who needs access to cash to pay their rent, salaries, suppliers, or purchase stock will be able to access a government-backed loan or credit on attractive terms,” adding that the government will make more loan available “as much is required”.
The amount available to small- and medium-sized businesses through the Coronavirus Business Interruption Loan, announced at the budget last week, has been extended from £1.2 million to up to £5 million with no interest due for the first six months. Larger firms will be able to access a facility with the Bank of England. Both schemes will be up and running next week, and his team is discussing special assistance for airlines in the wake of a number of them slashing routes by up to 80 per cent.
The chancellor of the Exchequer also confirmed that pubs, clubs, and other social venues suffering a drop in business will be able to access insurance claims against their policy. He also extended the business rates holiday to all businesses in the hospitality or retail sector for 12 months. The support comes after Prime Minister Johnson urged Britons to enact social distancing, telling them to “avoid pubs, clubs, theatres, and other such social venues” and to work at home where possible.
“We have never faced an economic fight like this one, but we are well-prepared. We will get through this, and we will do whatever it takes,” the chancellor concluded.