Indications of just how serious the coronavirus pandemic is threatening the survival of many British businesses became evident today.
As deaths from the virus reached 1,028 in the UK, the government decided to ease the pressure of companies on the verge of collapse.
The Business Secretary Alok Sharma used the usual daily government press conference from 10 Downing Street to announce the relaxation of insolvency measures to help companies battling to survive.
He said: “For businesses large and small, coronavirus represents an unprecedented challenge.
“Speaking with business leaders every day, I appreciate just how tough the situation is.
“When we tell people to stay at home, protect the NHS and save lives we know it has a real cost to your family and to your firms.
“I want to thank the many businesses and workers right across the UK who are playing a vital role in keeping the British economy going.
“I want to reassure them that is why we are working around the clock to get the funding as quickly as possible to where it is needed.”
He said that the first tranche of money for local councils to pay grants had arrived at town halls yesterday.
“I want to ensure the grant money is with businesses as soon as possible providing for direct funding support to almost a million businesses.”
Mr Sharma also said that employees who have not taken all their statutory leave due to covid-19 will now be able to carry that entitlement over to the next two years.
“I recognise just how hard employees, business owners and directors are working to keep their companies going”, he said.
“It is crucial that when the crisis passes, as it will, we are ready to bounce back.
“I want to announce more measures to give business greater flexibility as they face the current crisis to help them emerge intact the other side of the Covid-19 pandemic.
“We will introduce measures to improve the insolvency system. Our overriding objective is to help UK companies needing to undergo a financial restructure to keep trading.
“These measures will give those firms extra time and space to weather the storm and be ready when the crisis ends.”
Changes in the insolvency regime will mean that companies in difficulties will continue to be able to get hold of supplies and materials.
There will also be temporary suspension of wrongful trading provisions for company directors to remove the threat of personal liability during the pandemic.
Company rules on annual general meetings will be more flexible in terms of how they are held—possibly online or by telephone.
He also announced removal of red tape surrounding suppliers of hand sanitisers and personal protection equipment.
“I am incredibly proud how business and individuals across our great nation have risen to the challenge posed by Covid-19”.