Credit 500 members have shared reaction to the budget, as they welcome forbearance for small businesses and more time for people to repay advances on Universal Credit.
Rishi Sunak announced a coronavirus loan scheme will be introduced to cover the cost of salaries and bills for small and medium sized businesses, along with a £7bn package of support for the self-employed, businesses and vulnerable people, including a business rates holiday for some of the hardest-hit sections of the economy.
Away from measures to alleviate the impact of Covid-19, he pledged an additional £12.5m to HMRC to begin work "immediately" on implementing breathing space.
Joanna Elson, chief executive of the Money Advice Trust, said: “The newly-announced hardship fund for households and new support and forbearance for small businesses affected by the outbreak are particularly welcome – but it will be crucial to make sure that this support reaches those who need it most.
“Together with the Bank of England’s interest rate cut and the welcome additional forbearance measures announced by several banks in recent days, we are reassured that the impact of Coronavirus on household and business finances is being taken seriously.
“Today’s budget includes welcome changes to Universal Credit, with a lower cap on deductions from benefits and more time for people to repay advances. This is a further step in the right direction, but a more fundamental review of the deductions system is needed – along with a firm commitment to include Universal Credit advances and deductions in the government’s new Breathing Space scheme as early as possible.”
Stephen Haddrill, director-general of the Finance & Leasing Association (FLA), said: “The measures announced to help the NHS, consumers and businesses to deal with the likely disruption of coronavirus are very welcome.
“However, banks are not the only business finance providers, so the temporary Coronavirus Business Interruption Loan Scheme, in which banks will offer loans of up to £1.2m to support SMEs, would reach far more firms if non-bank lenders were also included in the plan.
“Supporting customers over the next few months will be absolutely vital – especially for those whose income is severely affected by the coronavirus disruption.”
Niels Turfboer, managing director of fintech lender, Spotcap, said: “We welcome the funding announcements for UK businesses – including £130m of new funding to extend start-up loans and £5bn of new export loans for businesses. Too many companies still struggle to access the right finance to reach their full potential. The additional funding will hopefully support more businesses, helping them to grow and hire more staff. This will – ultimately – benefit the UK economy as a whole.”
Duncan Swift, president of insolvency trade body, R3, said: “The return of HMRC’s preferential status in insolvencies is a badly-timed and ill-considered blow to the UK’s enterprise culture. It will damage business lending and business rescue, and will affect jobs, livelihoods and the economy.
“It’s perverse that on the day that the Bank of England has taken steps to boost business lending, the government has taken a step in the opposite direction.
“It is beyond frustrating that the budget has confirmed the policy will be introduced without meaningful changes from what was first proposed.”
Paul Burgess, chief executive of Startline Motor Finance, said: “It’s extremely welcome that the government has unveiled a range of measures designed to protect the economy but really, the used car market over the next few months will depend very much on the spread of coronavirus in the UK and how the public react. It is noteworthy that the government is now saying that the impact on the country will be ‘significant’. Certainly, it seems probable that people who are working from home and generally curbing their travel are probably going to be less likely to change their car, whatever steps are taken to protect businesses. There are simply a lot of unknowns.