BUSINESSES have welcomed the emergency support handed out by the chancellor to help with the coronavirus crisis.

Southampton-born Rishi Sunak delivered a budget revealing a £30billion package to stimulate the economy.

It came hours after the Bank of England announced a cut in interest rates.

Key measures included:

  • A business rates holiday for retail, leisure and hospitality firms with a rateable value of under £51,000.
  • Statutory sick pay from the first day employees self-isolate, with the government covering the cost for up to 14 days for companies with up to 250 staff.

“Quicker and easier” access to benefits for the self-employed and “gig economy” workers who cannot claim statutory sick pay.

A coronavirus business interruption loan scheme.

The Office for Budget Responsibility described it as the biggest “budget giveaway” since 1992, adding around £100billion to public borrowing by 2024.

Ross McNally, Hampshire Chamber’s chief executive and executive chairman, said: “Given the exceptional circumstances we face because of the immediate threat of coronavirus, it was not surprising that the focus of the budget was on short term measures.

“The chancellor talked about building a ‘bridge for business’ to help offset the medical crisis.

“Should staff have to be off work, the pledge to underwrite sick pay for companies with fewer than 250 employees will significantly ease the burden on their cashflow. The same goes for his move to defer tax payments in agreement with HM Revenue and Customs.

“The suspension of business rates for a year for companies involved in retail, leisure and hospitality is also welcome, as is his announcement that a fundamental review of business rates will take place, to be concluded in the autumn.

“Announced earlier in the day, the emergency cut in interest rates from 0.75 per cent to 0.25 per cent is a sensible, measured step to mitigate any lasting economic impact.

“And with cashflow set to be a continuing challenge for some companies, we welcome the lowering of capital requirements on banks to enable them to lend more to businesses.

“It remains to be seen whether or not these measures will be enough to sustain business confidence and keep the economy on track but they represent a prudent package at this stage.”

Duncan Swift, Southampton-based president of the insolvency and restructuring body R3, warned that measures to make HMRC a preferential creditor in insolvencies could hit efforts to rescue businesses.

“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,” he said.

“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.”

Tim Walker, managing director of Southampton-based IT firm Aura Technology, said: “This budget held some much-needed positive news for businesses after the uncertainties over Brexit, a slowing economy and now coronavirus. Measures to help small businesses mitigate the hopefully short-term impact of the virus were welcome, but I was pleased to see this didn’t dominate the agenda – there was plenty there for businesses of all sizes to feel encouraged by in the longer term.

“The smart use of technology is going to be a crucial factor in the ability of UK businesses to compete once we leave the EU, so I was encouraged by the confirmation of a £5bn pot to deliver gigabit-capable broadband through the country. This will be a relief to many businesses in rural areas of our region which are woefully under-served at the moment. The increase in R&D tax credit will also enable more businesses to invest in cloud computing and workflow systems that increase productivity.

“I was not surprised to see Entrepreneurs Relief take a hit, as this scheme has been criticised, but this is a move that does risk discouraging those who are motivated to build up a business for sale. However, I’m pleased this was reduced rather than abolished altogether. As the chancellor acknowledged, we need risk-takers to help drive employment and growth.”

Phil Hoyle, landlord of the London Tavern in Poulner, Ringwood, welcomed the business rates cut for pubs and the freezing of all alcohol duties.

He said: “The business rate discount from £1,000 to £5,000 is welcome – and hopefully it won’t be too little too late.

“Business rates are one of the overheads that make it extremely difficult to run a pub as a healthy, profitable business. The chancellor did acknowledge that pubs are the centres of community life and as such ought to given additional assistance.”

Michaela Johns, director at Southampton-based HWB Accountants, said: “We were pleased to see that Entrepreneurs Relief will stay, although it will only apply to the first £1m of Capital Gains Tax from the sale of a business instead of the current £10m.

"A huge slice of our economy is driven by entrepreneurs building businesses and creating employment, so it was encouraging to see that despite criticism of this benefit, the chancellor has decided to retain it in this new form. This as well as the increase in the R&D tax relief will be welcomed by UK businesses who have a direct effect on the health of the economy.

“We’re all focused on becoming greener as businesses and we welcome tax cuts that will help achieve this, including incentives for those which switch to electric vehicles.”