Second Report - The impact of Coronavirus on businesses and workers: interim pre-Budget report

Select Committee
Business and Trade Committee HC 1264 26 February 2021
Report Status Government responded
Conclusions & Recommendations 20 items (12 recs)
Source View on Parliament website
Government Response (AI assessment · 20 of 20 classified)
Accepted 11
Accepted in Part 2
Acknowledged 3
Deferred 1
Not Addressed 1
Rejected 2
Government response
First Special Report - The impact of Coronavirus on businesses and workers: interim pre-Budget report: Government Response to the Committee’s Second Report of Session 2019–21 · published 19 May 2021
Read the government response ↗ Response on the tracker

Recommendations & Conclusions

20 results
1 Conclusion Acknowledged
Para 17
We commend the Government for moving quickly at the start of the pandemic to implement...
Conclusion
We commend the Government for moving quickly at the start of the pandemic to implement novel and wide-ranging financial support schemes. We welcome these measures, which have delivered unprecedented levels of financial support to individuals and have shielded vast numbers … Read more
Government Response Summary
The government thanked the committee for the report and acknowledged the challenging circumstances of the pandemic, reiterating its role in providing unprecedented financial support measures for businesses.
Department for Business and Trade
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2 Conclusion Accepted in Part
Para 18
Whilst we welcome the overall level of support offered, we are disappointed that the Government...
Conclusion
Whilst we welcome the overall level of support offered, we are disappointed that the Government has repeatedly chosen not to adapt and refine its support to address identified gaps in coverage. It is unacceptable that 11 months into the pandemic … Read more
Government Response Summary
The government acknowledged concerns about gaps in support and stated it has taken steps, including amending CJRS and SEISS eligibility for specific groups like parents and reservists, and outlined further support announced in the Spring Budget 2021, though it recognized some hard cases still didn't qualify.
Department for Business and Trade
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3 Recommendation Rejected
Para 19
The Committee accepts that there are some groups who have been at a comparative disadvantage,...
Recommendation
The Committee accepts that there are some groups who have been at a comparative disadvantage, such as those remunerated by dividends. The Government has cited administrative difficulties and the risk of fraud. The Government should consider solutions put forward on … Read more
Government Response Summary
The government rejects the recommendation to consider solutions for distinguishing dividend income, stating they have engaged with proposals but found them not viable due to administrative difficulties, lack of data, and the risk of fraud with self-certification.
Department for Business and Trade
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4 Conclusion Rejected
Para 20
We welcome that many individuals who have not been able to access furlough or SEISS...
Conclusion
We welcome that many individuals who have not been able to access furlough or SEISS will have had support through Universal Credit, discretionary grants from local authorities, and mortgage and consumer credit holidays. However, we are disappointed by the Government’s … Read more
Government Response Summary
The government acknowledges that some individuals did not qualify for support but reiterates its scheme design principles, including targeting support and protecting against fraud and abuse, without committing to address the identified gaps or re-evaluate its justifications.
Department for Business and Trade
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5 Recommendation Accepted
Para 21
We are also concerned that gaps in support appear to have fallen disproportionately on particular...
Recommendation
We are also concerned that gaps in support appear to have fallen disproportionately on particular sectors, such as the creative industries. Further Government action is required to support those sectors of the economy.
Government Response Summary
The government acknowledges the challenges and details additional support for creative industries, including £300 million for the Culture Recovery Fund, an extension of the Film & TV Production Restart Scheme, and £300 million for the Sport Recovery Package.
Department for Business and Trade
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6 Recommendation Accepted
Para 22
We recommend that the Government reviews the coverage of current support to make sure that...
Recommendation
We recommend that the Government reviews the coverage of current support to make sure that the greatest support is provided to those individuals facing most hardship, and that any gaps in provision are addressed. We expect the Chancellor to announce … Read more
Government Response Summary
The government details various measures from the Spring Budget 2021, including targeted support through a turnover test for SEISS, new Restart Grants, additional discretionary business grants, and extensions to Universal Credit and Working Tax Credit payments, to ensure support for those facing hardship.
Department for Business and Trade
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7 Conclusion Accepted
We appreciate that not every job can be saved as the Chancellor has set out,...
Conclusion
We appreciate that not every job can be saved as the Chancellor has set out, but are nonetheless concerned about rising unemployment, which is particularly affecting women, BAME workers and young people because they are more likely to be employed … Read more
Government Response Summary
The government responds to the committee's concern about premature withdrawal of support by detailing the extension of the Coronavirus Job Retention Scheme (CJRS) and the Self-Employment Income Support Scheme (SEISS) until September, while also expanding eligibility for both schemes.
Department for Business and Trade
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8 Recommendation Accepted
Para 31
We recommend the Government urgently produces an economic assessment which sets out the opportunities and...
Recommendation
We recommend the Government urgently produces an economic assessment which sets out the opportunities and risks posed by structural long-term changes to the economy from the combined impacts of COVID-19, Brexit, and the net zero transition. We welcome the publication … Read more
Government Response Summary
The government responded by referencing its published 'Build Back Better: our plan for growth' and an upcoming 'Innovation Strategy', along with new bodies like the Build Back Better Business Council and NERT, as its comprehensive framework for addressing long-term economic changes and skill development.
Department for Business and Trade
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9 Recommendation Accepted
This plan should form part of the Industrial Strategy to ensure our educational institutions, key...
Recommendation
This plan should form part of the Industrial Strategy to ensure our educational institutions, key business sectors, the workforce and broader economy are strategically geared towards achieving long-term goals such as the net zero transition, our aging society and the … Read more
Government Response Summary
The government referenced its 'Build Back Better: our plan for growth' as the new framework integrating elements of the Industrial Strategy, along with an upcoming 'Innovation Strategy' and newly established councils and taskforces, to strategically achieve long-term economic goals.
Department for Business and Trade
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10 Recommendation Accepted
Para 39
We welcome the sheer scale of financial support the Government has provided to businesses since...
Recommendation
We welcome the sheer scale of financial support the Government has provided to businesses since March 2020. For many businesses, this support has allowed them to stay afloat during the pandemic. We also welcome the Business Rates Review announced in … Read more
Government Response Summary
The government states it has already provided targeted support through measures like Restart Grants for specific sectors and the new Recovery Loan Scheme, asserting that this ensures support is more tailored as recommended by the Committee.
Department for Business and Trade
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11 Conclusion Accepted
Para 40
We are particularly concerned for ‘bricks-and-mortar’ retail which is unable to compensate for physical closure,...
Conclusion
We are particularly concerned for ‘bricks-and-mortar’ retail which is unable to compensate for physical closure, as well as businesses such as those in the ‘live events’ industry which, though not legally forced to cease operations, have seen a collapse in … Read more
Government Response Summary
The government highlights existing and new measures, such as the Restart Grants for hospitality and leisure sectors and the Recovery Loan Scheme, which they state are designed to provide more targeted support and address the concerns about certain industries.
Department for Business and Trade
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12 Recommendation Accepted
Para 41
We recommend that if the Government returns to any form of tiered system or localised...
Recommendation
We recommend that if the Government returns to any form of tiered system or localised lockdowns, that financial support for business should reflect that.
Government Response Summary
The government claims it has already flexed business grant support throughout the pandemic to reflect changing restrictions and is providing new targeted support like Restart Grants and the Recovery Loan Scheme, which they state will ensure support is more targeted as recommended.
Department for Business and Trade
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13 Recommendation Accepted
Para 42
We expect the Government to respond to the pandemic with more nuanced and targeted policies...
Recommendation
We expect the Government to respond to the pandemic with more nuanced and targeted policies in future, and recommend that the Government uses the Budget to review the support it has offered to businesses and announce more targeted support aimed … Read more
Government Response Summary
The government states it has already provided and continues to provide targeted support through measures like Restart Grants and the new Recovery Loan Scheme, which they claim ensures support is more targeted in line with the Committee's recommendation.
Department for Business and Trade
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14 Recommendation Accepted
We have previously called on the Government to attach conditions to the use of taxpayer-funded...
Recommendation
We have previously called on the Government to attach conditions to the use of taxpayer-funded support and are disappointed that, on each occasion measures have been extended, the Government has failed to do this. We recommend that the Government reviews … Read more
Government Response Summary
The government accepts the recommendation to combat fraud and claw back funds, committing over £100 million to a new Taxpayer Protection Taskforce with 1,265 HMRC staff. It will also strengthen law enforcement for Bounce Back Loans and continue to work with agencies to recover funds, though details of recovery and prosecution approaches will not be made public.
Department for Business and Trade
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15 Conclusion Not Addressed
Para 50
With the moratorium on commercial rent obligations due to expire soon, the Government does not...
Conclusion
With the moratorium on commercial rent obligations due to expire soon, the Government does not appear to be any closer to identifying or facilitating a long- term solution to the difficulties faced by landlords and commercial tenants. While many landlords … Read more
Government Response Summary
The government outlines existing temporary tenant protection measures, including a voluntary Code of Practice, but does not identify or commit to developing a new long-term solution for commercial rent arrears beyond these expiring provisions.
Department for Business and Trade
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16 Recommendation Deferred
The Government should use the time afforded by current time-limited support measures wisely to identify...
Recommendation
The Government should use the time afforded by current time-limited support measures wisely to identify long-term solutions. The Government should consider active measures to address the issue of growing commercial rent arrears, and proactively work with businesses, landlords, banks and … Read more
Government Response Summary
The government described existing tenant protection measures and announced a Call for Evidence on commercial rents and COVID-19 to identify long-term solutions, including options for mediation or adjudication of rent disputes.
Department for Business and Trade
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17 Conclusion Acknowledged
Para 62
Throughout the pandemic the Government has attached expiry dates to support measures, which have since...
Conclusion
Throughout the pandemic the Government has attached expiry dates to support measures, which have since been found to be premature. In most cases, the measures have ultimately ended up being extended, which is undoubtedly the correct decision. In the early … Read more
Government Response Summary
The government acknowledges the need to review current measures and continue supporting businesses, but does not commit to a specific long-term strategy or avoiding future 'cliff edges' as highlighted by the Committee.
Department for Business and Trade
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18 Conclusion Acknowledged
Para 63
As of mid-February, with weeks to go before many support measures expire, the Government has...
Conclusion
As of mid-February, with weeks to go before many support measures expire, the Government has not yet set out which measures will be extended. We understand that the specific course of the pandemic is inherently uncertain, and new restrictions may … Read more
Government Response Summary
The government provides a generic response stating it will continue to review current measures and support businesses, without offering the broad assurances or specific details on extensions that the committee hoped for.
Department for Business and Trade
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19 Recommendation Accepted in Part
Para 64
As more of the population is vaccinated, the Government must shift its policy- making approach...
Recommendation
As more of the population is vaccinated, the Government must shift its policy- making approach from reacting to rapidly changing circumstances towards long-term considerations. In his Budget, the Chancellor must give businesses and workers the security and certainty they need … Read more
Government Response Summary
The government refers to its published 'Build Back Better: our plan for growth' as its long-term strategy for recovery. However, it rejects the suggestion to convert COVID loan debt into grants, advising businesses to discuss repayment options with their lenders.
Department for Business and Trade
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20 Recommendation Accepted
We welcome the strong level of engagement between the Government and business in the early...
Recommendation
We welcome the strong level of engagement between the Government and business in the early months of the pandemic. The Government must be as open with the business sector as possible, particularly by providing reasonable notice and 24 The impact … Read more
Government Response Summary
The government accepts the recommendation for proactive and ongoing engagement with businesses and trade union leaders. It confirms plans to continue engagement, communicate changes with sufficient notice, and build feedback into policymaking as the economy recovers.
Department for Business and Trade
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