COVID-19 UPDATE – ECONOMIC BRIEFING INCLUDING CLARIFICATION ON TRADESPEOPLE

I have received clarification as to how residents should be dealing with individual tradespeople coming to their house. This clarity appears to give more flexibility than was first anticipated. The extract is set out below:

“For individual tradespeople or those offering repairs or maintenance services to people in their homes they must observe Public Health England guidance and only continue to work if they are well and have no symptoms (including mild symptoms); do not go into the homes of people isolating or vulnerable people who are being shielded; at all times observe the highest standards of hygiene; and be particularly mindful of touching surfaces.”

Set out below is an abridged extract of a Covid – 19 Economic Briefing Note I have been sent that contains the paragraph above.

START

Many businesses are adapting, including working together, sharing best practice and moving more provision online.

Businesses who continue to operate are following Government guidance and enforcing strict hygiene and social distancing, removing employees who have underlying health conditions, allowing staff to work from home where possible and other initiatives such as staggered lunch breaks and altering opening times.

Council services continue to operate and are providing employment support (including to major food retailers with their recruitment, and the health and care sectors), business rates, delivering the Government grant programmes and enforcing business closures.

For businesses operating in contravention of the Health Protection (Coronavirus, Business Closures) Regulations 2020 they will be committing an offence and should be reported to epteam@leeds.gov.uk

Where licensed premises are still open (excluding for takeaways) these should be reported via entertainment.licensing@leeds.gov.uk

Properties in Leeds who currently receive Small Business Rate Relief (all properties with a rateable value of up to £15,000) will be eligible for a £10,000 grant. Businesses do not need to apply for grants; if they are eligible the Council will contact them in early April when funding becomes available. If businesses would prefer to receive the payment via BACS payment rather than a cheque, they can provide their bank details through the Small Business Grant payments form via this link: https://forms.leeds.gov.uk/SmallBusinessGrants/

Coronavirus Business Interruption Loan Scheme, business rates relief (for those not currently covered) and the time it is taking to access support.

Council services continue to operate and are providing employment support (including to major food retailers with their recruitment, and the health and care sectors), business rates, delivering the Government grant programmes and enforcing business closures.

Business Closures and Key Workers

On 23rd March the Prime Minister gave an evening statement announcing restrictions on movement. People will now only be allowed to leave their home for the following very limited purposes:

 shopping for basic necessities, as infrequently as possible;

 one form of exercise a day – for example a run, walk, or cycle – alone or with members of your household;

 any medical need, to provide care or to help a vulnerable person; and

 travelling to and from work, but only where this is absolutely necessary and cannot be done from home.

Since then further guidance has been issued on which businesses must close and who can work – links are provided in this note rather than lists as the guidance continues to be updated.

Government guidance has been produced around the types of business and business premises that should now stop operating as well as exceptions and is available here. With the exception of the organisations required to close, the Government has stated it is important for business to continue. Employers and employees should discuss working arrangements and wherever possible arrangements should be made to allow for people to work from home.

The Government has also produced a list of key workers and this is available here. These are the workers who can continue to send their children to school/childcare settings.

For individual tradespeople or those offering repairs or maintenance services to people in their homes they must observe Public Health England guidance and only continue to work if they are well and have no symptoms (including mild symptoms); do not go into the homes of people isolating or vulnerable people who are being shielded; at all times observe the highest standards of hygiene; and be particularly mindful of touching surfaces.

Enforcement of business closures

 Local government (through Environmental Health and Trading Standards officers) will be responsible for enforcing regulations requiring those businesses asked to close, with police support if appropriate, and will work together to issue prohibition notices challenging unsafe behaviours where businesses do not follow these restrictions. A business operating in contravention of the Health Protection (Coronavirus, Business Closures) Regulations 2020 will be committing an offence and should be reported to epteam@leeds.gov.uk

Businesses who fail to comply will receive fines and could also face the loss of their alcohol license and there will be no upper limit to the fines of businesses who continue to ignore restrictions.

Business Intelligence

The Council is working with businesses across the city in order to provide support and whilst information on specific businesses needs to remain confidential we are working to provide more general information on business health.

This week we began working with Axia Origin to provide up to date intelligence on businesses in the Leeds economy. This is being done through reviewing social media data. So far this week 226 Leeds based businesses have been analysed, of these 51 businesses were actively discussing how they and the community they are in are self-organising in response to the coronavirus outbreak, helping each other adapt and sharing best practice, teaming up for deliveries, moving businesses online and offering virtual service provision, with Food and Drink businesses making up the largest proportion (31%).

Almost half (44%) of the businesses analysed were temporarily closing, with many (in Professional Services, Retail and Food & Drink) moving to online operations.

Amongst business owners anxieties centre on the question of which roles are considered essential, as well as fears for the self-employed. There have been lots of conversations around ‘falling between the gaps’ of official announcements and support and these represent urgent issues for very specific segments of the workforce, e.g. plumbers asking each other whether they are considered essential workers or not.

Those who were self-employed were anxious about what support would be given to them, with those concerned being across all sectors (note this was prior to the Chancellor’s package for the self-employed on 26th March and we will be continuing to update this work).

 Employment and Skills Support

The Department of Work and Pensions is currently redeploying staff from work coach positions that have claims experience to support the increase in applications for benefit support.

The Council’s Employment and Skills service is currently linking those seeking work with:

 Major retailers – Tesco, ASDA, Aldi, LIDL and Co-op to recruit to customer service operative, warehousing and distribution centres and job roles supporting online services and delivery – demand for delivery drivers is high. Recruitment was site-based but has now moved back online to comply with Covid-19 restrictions on non-essential travel.

The health and care sector – care roles, porters and cleaners across hospitals, care settings and the ambulance service. WeCareAcademy is leading the recruitment to part and full-time, temporary and permanent care roles in home care, supported living care and residential care. Full training will be provided, so previous experience is not necessary. An assessment centre will be held Thursday 26th and Friday 27th March at Merrion House, Leeds City Centre, with training provided the following week. Contact: wecareacademy@leeds.gov.uk

Local residents can visit the Leeds Employment Hub website or email employmenthub@leeds.gov.uk  where they can leave their details and an Employment Advisor will get back to them or people can call 0113 3784576 if they require support to re-enter the labour market and for advice about which businesses are currently recruiting.

For students at home during the school closures, we have created a series of Home Learning Activities on StartinLeeds, our digital careers education platform, to help them stay engaged with their careers learning and support them to make informed choices moving forward.

Leeds City Council’s Business Support team is also receiving a large number of enquiries from businesses via the Business Support inbox/telephone line.

Business Support Measures – delivered by Leeds City Council

Business Rates

Following the budget announcements on 11th March the Council has reissued rates bills for the financial year 2020/21 to approximately 2,000 properties that are now eligible for a 100% retail discount so they no longer pay any rates during this period – this covers bars, restaurants and shops plus the proposed expansion to cover the leisure and hospitality sector.

This week the Government extended this rates relief programme to include estate agents, lettings agencies and bingo halls that closed as a result of Covid-19. The Government specified that eligible businesses will be rebilled with the updated discount and refunded by the relevant local authority if payments have already been made.

Given the demands on the council’s finances it has suspended new applications for Discretionary Rate Relief (including any requests to extend existing reliefs) until further notice and until clarity is received on the government support package and any gaps that may be identified.

For businesses who are currently in difficulty and who are requesting assistance, the Council is also putting a temporary stop on existing rates payments. If any company is in financial difficulty due to Covid-19 and is asking for assistance they should email business.rates@leeds.gov.uk

Commercial tenants

Commercial property tenants will continue to be invoiced by the Council. We are offering support to businesses that have been impacted on a one-to-one basis. We will also pause any recovery action on commercial rent collections for the next three months, after which time this will be reviewed. For more information contact CityDevelopmentIncomeTeam@leeds.gov.uk. Buildings which provide non-essential services will be closed. Construction contracts are being reviewed to try to continue any work that is considered a priority.

Grants

Properties in Leeds who currently receive Small Business Rate Relief (all properties with a rateable value of up to £15,000) will be eligible for the £10,000 grant. There are approximately 10,000 properties in Leeds who will we qualify for this assistance, and this is provided to each property rather than each business.

Properties in Leeds with a rateable value between £15,000 and £51,000 in the retail, hospitality and leisure sectors will be eligible for a £25,000 grant. There are approximately 2,300 businesses who will be eligible for the grant.

The Council Business Rates team are looking at mechanisms to deliver these grants and the funds should be available for payment by early April. Businesses do not need to apply for grants; if they are eligible the Council will contact them in early April when funding becomes available. If businesses would prefer to receive the payment via BACS payment rather than a cheque, they can provide their bank details through the Small Business Grant payments form via this link: https://forms.leeds.gov.uk/SmallBusinessGrants/

Housing

The Government has announced it is re-linking Local Housing Allowance to local rents to provide a further boost to benefits. The increase in housing benefit rates will particularly help private sector tenants in parts of the country where rents have increased quickly since 2012 – areas such as Cambridge and areas around London for example. Someone renting a three-bed house in Cambridge will see their maximum benefit rise by more than £37 a week.

In Leeds, the Local Housing Allowance rate for a three-bed house for 2019/20 was £149.59. The 2020 rate was originally set at £152.13 but this is currently less than the 30% of market rate minimum announced by the Chancellor. If the 30% was to be met it would raise LHA in this case to £161.10. We are awaiting instruction from DWP to clarify this and it should be noted that the increase would not apply if the rent that is charged by the landlord is currently less than these rates.

Business Support Measures – delivered nationally

Loans

For small- and medium-sized businesses, the new Coronavirus Business Interruption Loan Scheme is now available for applications. This scheme will help any viable business with a turnover of up to £45m to access Government-backed finance of up to £5 million. Interest payments and any lender-levied fees for businesses will be covered by the Government for an initial period of up to 12 months. The scheme is available through more than 40 accredited lenders, which are listed on the British Business Bank website: https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils/

The Bank of England’s new lending facility for larger firms – the Covid Corporate Financing Facility – is also now open for applications.

There has been some concern from businesses regarding the practicalities of these loans, the time it will take for them to be in place, the requirement for full due diligence and personal guarantees to manage risk in the financial services system and reports of a high interest rate. Some businesses are reporting that there does not seem to be a big difference between these and normal loans. Other businesses are reluctant to take on more debt in this situation.

Support for workers

The Coronavirus Jobs Retention Scheme under will provide a grant to employers to keep their workers on rather than make them redundant. Salaries will be paid at 80% of their current level up to a maximum of £2,500. These grants will be available by the end of April and in the meantime £30bn of cash flow relief has been provided through the deferment of VAT bills. For VAT, the deferral will apply from 20 March 2020 until 30 June 2020.

HMRC are working urgently to set up a system for reimbursement. Existing systems are not set up to facilitate payments to employers. This will require employers to submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal.

The scheme has been welcomed as a positive step to secure jobs and can also be used to furlough workers who are at high risk to the virus offering more protection to vulnerable people. There is still some confusion on the detail, for example whether this covers just a worker’s salary or also National Insurance Contributions. Also there may be some unintended consequences with the scheme – for example an employer with 10 employees might have enough work to keep them all occupied half time. This policy gives a very clear incentive to furlough half of them and keep half of them on full time. It will also discourage employees from moving to job opportunities that will be opening up, including in areas where the virus outbreak has increased demand for workers.

In terms of cost, the Institute for Fiscal Studies estimates that if just 10% of employees are affected it could cost the Government in the order of £10 billion over three months. Further analysis from the Resolution Foundation showed that in many cases additional support through Universal Credit or Tax Credits is available for employees where their family claim in-work benefits, topping up most of the 20% of income lost (as the Job Retention Scheme only pays up to 80% of wages). Support would happen automatically if the family already receives in-work support, or will be subject to a new claim being made if not.

Support for the Self-Employed

The Government has announced a new Self-employment Income Support Scheme that will allow the self-employed to claim a taxable grant worth 80% of their trading profits up to a maximum of £2,500 per month for the next three months. This may be extended if needed and should be ready for the beginning of June – payments will be backdated to 20th March.

HMRC will use the average profits from tax returns in 2016-17, 2017-18 and 2018-19 to calculate the size of the grant. The scheme will be open to those where the majority of their income comes from self-employment and who have profits of less than £50,000. The taxable grant will be based on the average monthly profits (not revenue and is not applicable to those who pay themselves in dividends) and the self-employed are being given a further four weeks to file their tax returns, which may also help a person’s cash flow. Government ministers have indicated that people without three years of tax returns should still contact HMRC who will try and assist once the scheme is operational.

Key Contact Details Name Contact Details
LCC Business Support https://www.leeds.gov.uk/coronavirus/business

 

Leeds City Council Intelligence Hub inclusive.growth.strategy@leeds.gov.uk

 

Leeds City Council Business Rates business.rates@leeds.gov.uk

 

LEP Business Support https://www.the-lep.com/business-support/covid-19-support-for-businesses/

 

Email: businessgrowth@the-lep.com

 

Telephone: 0113 348 1818

 

Compliance team epteam@leeds.gov.uk

 

Licencing entertainment.licensing@leeds.gov.uk
National helpline for businesses & self-employed Telephone: 0800 0159 559