After our successful campaign last week, over 350 business owners co-signed a letter to Rishi Sunak, Chancellor of the Exchequer, asking for him to consider writing off business loans in the upcoming budget. We are please to publish this letter below and thank you for your support.
As a broad coalition of businesses, we have diverse and differing experiences of the coronavirus pandemic. However, we are united in the belief that March’s budget represents one of the most significant points in the future of our companies. We have, up until now, managed to weather the economic storm caused by both the pandemic and the associated lockdown measures, yet many challenges remain.
With reports suggesting that 250,000 small businesses face the prospect of insolvency in 2021 without increased support, we are writing to you to urge you to consider including a provision within the budget on March 3rd that would write off the debt accrued by SMEs through the Government’s Coronavirus Business Interruption Loan Scheme (CBILS) and the Bounce Back Loan Scheme (BBLS).
Your decision to extend CBILS and BBLS loan repayment terms under the “pay-as-you-grow” initiative, only prolongs the inevitable and does not provide reassurance to the millions of SMEs across the UK calling for your help. SMEs need a lifeline and writing off Government-backed loans would give companies the best possible opportunity to keep trading long into the future.
Many businesses took advantage of the Government’s economic support packages in 2020 with the understanding that lockdown restrictions would be a short-term inconvenience for their business, and they would be back to “business as usual” sooner rather than later. However, almost 12 months on lockdown restrictions have remained in place intermittently throughout and with the benefit of hindsight, many of these businesses would reconsider their options.
Writing off these loans will cost approximately £68.2 billion. In 2008, the Government bailed out the banks at a cost which makes the above proposal pale into insignificance. Offering SMEs this same treatment will not only expedite the recovery of the job market and the economy, but it will also save the livelihoods of thousands of people.
We appreciate the gravity of the situation this country faces economically. However, with SMEs accounting for 50% of private sector turnover and supporting over 16.6 million jobs, the question is not whether we can afford to write off business loans, but rather can we afford not to?
The Government cannot pay lip service to SMEs, entrepreneurs, and employees by stating they are the backbone of the British economy, whilst expecting them to shoulder the economic burden of the recovery. It is time that business are rewarded for their compliance and hard work, through a comprehensive economic package that supported SMEs through the next 12 months and beyond. This should be underpinned by swift and decisive action that would see CBILs and BBLs entirely written off for SME’s across the United Kingdom.
The Fighting Back for Business Campaign