Government’s plans to give the staff of businesses that are required to shut 67% of their salary seems very fair but not if you are on the minimum wage, said leading tax and advisory firm Blick Rothenberg.
Andrew Sanford, a business advisory partner at the firm said: ‘People on the minimum wage should have been given their full salary. Many of those who are affected are on the minimum wage, and simply cannot afford another wage cut, having lost most of their income between March and early July. The 67% restriction should only have applied after the minimum wage level had been reached.’
‘Looking after the staff is one thing and again the government’s plans of giving businesses up to £3,000 per month seem fairly generous but unfortunately for many who are strapped for cash it just won’t be enough because many businesses, even those that have been trading during the summer just won’t have caught up and they may now have no option but to close.’
Andrew added: ‘There are also problems for those who are forced to close even with the support for the business itself and the staff wage allowance. Many in the catering and hospitality area will have to dump thousands of pounds of perishable stock and they may not have the money to re-stock depending on how long their local lockdown lasts.’
He added: There are those suppliers and businesses that have hardly traded since the start of the initial lockdown who once again fall outside of the government’s plans, will not be forced to close but in fact will be forced to cease trading.’
‘A business that supplies labour for large events such as conferences and theatre shows would have had negligible income for seven months, yet at best can only get 22% government funding under the job support scheme, while the pub can fund 67% of its staff wages, having already benefitted from Eat out to Help out.’
Andrew concluded: ‘The announcement on Friday does not cover the supply chain of the hospitality sector. They are able to open their offices but have nobody to supply to. Access to the new scheme is dependent on the business being compelled to close its premises. They not be forced to close but in fact, will be forced to cease trading.’
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