HU UPDATE: 28th April 2020
BOUNCE BACK LOANS
SOCIAL DISTANCING / REOPENING
ONLINE FRAUD PROTECTION
With businesses still struggling for their very survival during lockdown, and Hospitality Ulster engaged in ongoing lobbying of both the NI Executive and UK Government, it would be all too easy to miss the next big challenges- the when, how and what.
- When will the hospitality industry be allowed / told to reopen?
- How will this be impacted by social distancing measures?
- What (if any) government support will be given to the hospitality industry as we reopen and rebuild?
But, with some countries starting to relax their lockdown measures and impose social distancing restrictions, it is vital that we are working with government to inform the debate and ensure our industry and your business gets the help it needs.
At the beginning of the crisis we established an Industry Response Group, chaired by Brian Murphy (Managing Partner at BDO NI) with ongoing legal advice provided by Colin Mitchell, (Senior Partner at MTB Solicitors), and with Hospitality Ulster and NI Hotels Federation working in partnership alongside representation from all the sectors within our respective remits.
Whilst our Response Group continues to advise on the current and pressing issues, we have also begun then process of building the case for additional and ongoing support as, and when, we move to reopen and rebuild our industry- as government must realise that it cannot tell us to reopen without the necessary financial support or we will simply go bust, and all of the initial support will have been wasted.
We must also ensure that any social distancing measures put in place protect our staff and customers, but that they are also actually deliverable within individual premises.
We cannot simply reopen and take our chances, as reduced capacity under social distancing will not work financially, unless we are supported by government throughout the rebuilding process.
To that end, the Response Group has begun the process of developing an industry recovery plan to identify the ‘what’ and ‘how’ for ‘when’ the time is right.
Whilst there is still lots of work to do, the group will bring forward its first report in the coming days and engage with government, local authorities and health and safety experts, to develop a meaningful plan and the evidence to back our call for ongoing government support.
It will not be business as usual for our industry and cannot be businesses as usual for government when it comes to recognising the importance of the hospitality sector to tourism and the wider economy.
CEO, Hospitality Ulster
The FCA has set up a financial ombudsman service to arbitrate insurance claims for smaller businesses with a turnover of less than £6.5m and fewer than 50 employees.
The decision of the ombudsman would be binding on insurers up to £350,000 and may provide a route other than legal challenge for those who believe they have sufficient cover for COVID19 claims.
CLICK HERE to email the Financial Ombudsman
BOUNCE BACK LOANS
UK Chancellor Rishi Sunak announced a new Bounce Back Loans (CLICK HERE) scheme that will be made available to small businesses from 9:00 on Monday 4th May.
These loans will be 100% government-backed, will be interest free and no repayments will be due during the first 12 months. Government will also pay any fees.
Businesses can apply online through a short and simple form.
The new loan scheme will sit alongside existing grants and business support. Businesses will be able to borrow between £2,000 and £50,000 and access the cash within days. The government will work with lenders to ensure loans delivered through this scheme are advanced as quickly as possible and agree a low standardised level of interest for the remaining period of the loan.
Government are also taking additional steps on the Coronavirus Business Interruption Loan Scheme (CBILS) to ensure that lenders have the confidence they need to process finance applications quickly, including removing the per lender portfolio cap for the government guarantee, and changing viability tests that so that all banks will need to assess is whether a business was viable pre COVID-19.
SOCIAL DISTANCING / REOPENING
During weekend press conferences, Foreign Secretary Dominic Raab has said that the UK's lockdown needs to be eased carefully but suggested social distancing measures could be expanded to non-essential businesses to allow them to reopen.
Professor Stephen Powis, the NHS’ National Medical Director for England, said that SAGE is currently reviewing the most appropriate measures to keep transmission rates low, which will likely include a combination of different measures. This may inform advice on reopening.
The Tourism Minister, Nigel Huddleston, met with G20 Ministers to discuss COVID 19 over the weekend.
He spoke about the importance of tourism to the UK economy and its recovery and highlighted the key areas of concern for business around social distancing and the need for tapered support as businesses adjust.
In a statement, all Tourism Ministers recognised the importance of tourism globally, contributing over 10% of world GDP, and highlighted that 75 million jobs could be at risk across the sector unless additional support was provided to mitigate the social and economic effects of the pandemic as outlined in the G20 action plan.
CLICK HERE to read the full statement
Updated details (CLICK HERE) about how which VAT payments can be deferred including payments on account and monthly and quarterly payments.
Government has confirmed it will shortly be publishing legislation (CLICK HERE) to tackle aggressive rent enforcement.
This will provide retrospective protection and void any statutory demands served between 1 March and 30 June (with an option for extension).
The only exception will be where a winding up petition was already issued before the policy was announced – which cannot be voided.
The legislation will also prevent creditors petitioning for a company to be wound up on the grounds that it cannot pay its debts, unless the court permits and is satisfied that the inability to pay debts is not as a result of Covid-19.
This will have effect from 27 April until 30 June (with an option for extension). If a winding-up petition is placed between 27 April and the point that this new law comes into force, the court will apply the test after the fact.
This may mean the petition and any winding-up order based on it will be overturned, in which case the court will have the power to order the creditor who presented the petition to pay to restore the company to the position that it was in beforehand.
Government is also working with landlord representatives to ensure that all parts of the property chain are appropriately supported.
This includes, but is not limited to:
- monitoring the impact of the above moratorium on the financial health of landlords in advance of it ending in June
- ensuring existing business support programmes are adequate to support the sector
- working with stakeholders to agree best practice for landlords and lenders during this period.
To support this, the FCA and PRA have issued a joint statement encouraging lenders and other parties to respond positively to potential breaches of covenant.
PROTECT YOUR BUSINESS FROM ONLINE FRAUD
Guidance on how to protect yourself and your business from fraud and cybercrime during COVID-19 has been published.
CLICK HERE to open