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Will Rishi Sunak’s mini-budget help small businesses to thrive?

Yesterday, Chancellor Rishi Sunak delivered his summer economic update which set out a ‘Plan for Jobs’ and included benefits to keep the hospitality industry afloat. 

He announced a package of measures which he said would help to retain jobs and give business the confidence to retain and hire staff. 

These included: a one off £1,000 Job Retention Bonus to help keep firms keep furloughed workers; a £2billion Kickstart Scheme to create jobs for young people aged 16-24 and a £2,000 apprentice benefit.

We also saw the Eat Out to Help Out scheme launched and a VAT cut to help the hospitality and domestic tourism industries.

Entrepreneurs gave their views on yesterday's mini-budget. From left to right: Danny Curran, chief executive of probate research firm, Finders International; Catherine Ellis, founder of bike bag company Hill & Ellis; Alexandra Pluthero, founder of underwear brand Wear My Freedom and Louise Palmer-Masterton, founder of Stem + Glory restaurants

Entrepreneurs gave their views on yesterday’s mini-budget. From left to right: Danny Curran, chief executive of probate research firm, Finders International; Catherine Ellis, founder of bike bag company Hill & Ellis; Alexandra Pluthero, founder of underwear brand Wear My Freedom and Louise Palmer-Masterton, founder of Stem + Glory restaurants

However, the new measures got mixed reviews from entrepreneurs. While some measures were seen as a life saver to keep the doors open, others felt they were not enough to keep staff on after the furlough scheme was finished. 

Below, we gauged the reaction from seven businesses, a restaurant, PR agency, marketing firm, a probate specialist, an underwear brand, a pub and a bag company share their views… 

I will open my doors for longer    

Louise Palmer-Masterton, founder of Stem + Glory restaurants in Cambridge and London says the Eat Out to Help Out scheme will make her consider opening her restaurant doors for more than her planned three days a week. 

‘Overall, [the mini-budget] is extremely positive. They are not just handing cash out but doing it in collaboration with the businesses. 

‘This Monday to Wednesday scheme is quite clever and it’s clear they’ve done their research. 

‘We were planning to open Thursday, Friday and Saturday and not Monday to Wednesday but we’re now reconsidering Monday to Wednesday because of the support.

‘I’m pretty sure other restaurants were thinking of doing this and pretty cautious in opening. 

‘It also spreads people out so it’s not so crazy on other days like weekends.’

Louise says the incentives will encourage her to hire younger staff at her new restaurant location. 

‘We’ve actually just agreed terms on a new site in Cambridge in October. So I immediately think that Kickstarter campaign can help us to attract new, younger people who have all the energy – we could do something really nice with that.’  

Louise Palmer-Masterton, founder of Stem + Glory restaurants says the Eat Out to Help Out Scheme will make her consider opening her doors for longer during the week

Louise Palmer-Masterton, founder of Stem + Glory restaurants says the Eat Out to Help Out Scheme will make her consider opening her doors for longer during the week

Louise Palmer-Masterton, founder of Stem + Glory restaurants says the Eat Out to Help Out Scheme will make her consider opening her doors for longer during the week

It will help me in promoting my hospitality clients

Laura Hogan, owner of Birmingham-based PR agency Jelly Bean, believes the Eat Out and Help Out scheme will go some way to help her promote her hospitality clients. 

She says: ‘The Government endorsed 50 per cent reduction in Eat Out to Help Out will help many of our clients to market their services once again and survive short term while the economy recovers.’

Laura Hogan, owner of PR agency Jelly Bean says she is now hunting for two young employees

Laura Hogan, owner of PR agency Jelly Bean says she is now hunting for two young employees

Laura Hogan, owner of PR agency Jelly Bean says she is now hunting for two young employees

The incentives to hire younger people in the mini-budget will also help her business and she’s keen to hire two young employees. 

She adds: ‘Previously, we had not considered apprenticeships and traineeships as a method of recruitment. 

‘However, with the proposed incentives to employers for employing 18-24 apprentices, we will be able to commit more resource to training. 

‘This will make apprenticeships a much more viable proposition for our business.’

But she feels not all the incentives will work to save jobs.

She adds: ‘The Jobs Retention Bonus is a positive reward for businesses like us who are already working hard to return staff from furlough. But I do not believe that it will incentivise businesses to return staff to work, whose labour requirements have largely depleted.

‘So particularly in leisure and hospitality, we fear that this incentive will not save the jobs expected.’ 

I don’t buy into the idea of ‘all in this together’

Jamie Love, chief executive and founder of Monumental Marketing in London, is also concerned about whether furlough employees will retain their jobs in the long term. 

Jamie Love, CEO and founder of Monumental Marketing is disappointed the CBIL loan was not addressed in the summer statement

Jamie Love, CEO and founder of Monumental Marketing is disappointed the CBIL loan was not addressed in the summer statement

Jamie Love, CEO and founder of Monumental Marketing is disappointed the CBIL loan was not addressed in the summer statement

He says: ‘I believe the new job retention bonus is a great way to incentivise bringing employees back into the workplace.

‘However, I am concerned as to whether companies are able to support this in the long term and not just jump at the opportunity.

‘Covid-19 has meant businesses haven’t been able to plan far ahead, making this a tricky situation to bring someone back when things in business are still pretty uncertain given the implications of shops reopening and the added expenditures to ensure they are complying with government guidelines. 

‘I would urge employers to look at their cashflows and ensure there is longevity in their plans to take staff off furlough.

‘I am also disappointed the Coronavirus Business Interruption Loan was not addressed in the summer statement. 

‘I was denied my CBIL, despite being entirely self-funded, with a turnover over hundreds and thousands, powered by young minorities and always paying our taxes. 

‘I can’t believe in this idea of “all in this together” and today’s budget has not done much to assure me on that front too.’

I’ll be looking closely at the fine print

Danny Curran, chief executive of probate research firm, Finders International in London is positive about the Kickstart Scheme, but will be studying the terms of it intently.

‘As a firm which has always encouraged recruitment of young people, the Kickstart Scheme which will allow us to hire more younger members of staff, with less trepidation. 

‘However, contractual commitments will need to be honoured so we will be looking closely at the finer criteria for the grant.’

Danny Curran, chief executive of probate research firm, Finders International is positive about the Kickstart Scheme but will study the terms and conditions of it before signing up for it

Danny Curran, chief executive of probate research firm, Finders International is positive about the Kickstart Scheme but will study the terms and conditions of it before signing up for it

Danny Curran, chief executive of probate research firm, Finders International is positive about the Kickstart Scheme but will study the terms and conditions of it before signing up for it

He adds: ‘Equally, as a firm which handles a significant number of pro-bono cases each year, we welcome to VAT lowering for food. 

‘Many older people who die intestate, for whom we act, have died linked to issues around poverty so we hope this will make a difference for the weekly shop – especially for those most vulnerable.’

I’m disappointed more was not done for retailers

Alexandra Pluthero, founder of underwear brand Wear My Freedom based in London, is one of the many that benefited from a bounce back loan but feels more could’ve been done for retailers. 

Alexandra Pluthero, founder of underwear brand Wear my Freedom is disappointed that a scheme similar to the Eat Out to Help Out scheme was not devised for retailers

Alexandra Pluthero, founder of underwear brand Wear my Freedom is disappointed that a scheme similar to the Eat Out to Help Out scheme was not devised for retailers

Alexandra Pluthero, founder of underwear brand Wear my Freedom is disappointed that a scheme similar to the Eat Out to Help Out scheme was not devised for retailers

She says: ‘I received a bounce back loan however I was surprised there wasn’t more comprehensive support for SMEs to continue to grow, and therefore pay back the loan.

‘As a retailer, I was disappointed to see the Government has chosen to solely support hospitality at the expense of SMEs in other sectors like myself.

‘I was very hopeful for the rumoured retail vouchers and it really feels like there is a lack of support in retail, which has suffered hugely during the pandemic.

‘This leaves the short-term success of my small business up to consumer choice rather than providing an incentive for them to spend in retail stores.

‘However, the Kickstart Scheme is extremely interesting and government covering up to six months pay for young workers has dramatically increased the likelihood of hiring my very first employee.

‘This will really help to grow my business in the medium term and help me take on a 16-24-year-old that can gain experience in a small business with a flexible and dynamic work environment. 

‘This was one of the reasons I quit my corporate job to start my company, so I’d love to give someone that opportunity.’

Chancellor of the Exchequer Rishi Sunak answering a question in the House of Commons

Chancellor of the Exchequer Rishi Sunak answering a question in the House of Commons

Chancellor of the Exchequer Rishi Sunak answering a question in the House of Commons

I hope this will help in getting my bustling pub back 

Caroline Roylance, owner of pub The George at Fordingbridge, in Hampshire believes the VAT cut and the Eat Out to Help Out scheme will go a long way to helping her business get back on its feet.

She says: ‘Since we closed our doors we’ve had no income, no government support through grants and had to furlough 20 staff. We’ve tried to offer take away meals but the uptake was not enough to make it a viable option.

As a retailer, I was disappointed to see the Government has chosen to solely support hospitality at the expense of SMEs in other sectors like myself 

 

Alexandra Pluthero, founder of underwear brand Wear My Freedom

‘We will definitely be applying for the Eat Out to Help Out discount scheme, and the VAT reduction will help us make it through the next few months, because trade is unlikely to return to pre-Covid levels for some time.

‘Saying that, it’s been surprisingly busy today, which is encouraging, but it’s still not July busy. It’s a start though.

‘People are getting used to the new normal and social distancing measures, and we are doing everything possible to ensure customers will feel safe when they do return.

‘I’m hopeful that we will have our bustling local pub back again in a few months, and the VAT cut and discount meals scheme will certainly help get it there.’

Caroline Roylance, owner of The George in Fordingbridge in Hampshire says she hopes these measures will help her get her bustling pub back again in a few months

Caroline Roylance, owner of The George in Fordingbridge in Hampshire says she hopes these measures will help her get her bustling pub back again in a few months

Caroline Roylance, owner of The George in Fordingbridge in Hampshire says she hopes these measures will help her get her bustling pub back again in a few months

I’m disappointed the Chancellor wasn’t more green

Catherine Ellis, founder of bike bag company Hill & Ellis, which has put sustainability at the forefront of her business policies says she’s disappointed that the Chancellor hasn’t offered more money to help build green initiatives. 

Catherine Ellis, founder of bike bag company Hill & Ellis is concerned that the jobs retention scheme could be open to abuse

Catherine Ellis, founder of bike bag company Hill & Ellis is concerned that the jobs retention scheme could be open to abuse

Catherine Ellis, founder of bike bag company Hill & Ellis is concerned that the jobs retention scheme could be open to abuse

She says: ‘As Shadow Chancellor Anneliese Dodds put it, this Government’s entire commitment to green technology is only as much as Germany’s commitment to just one single form of green technology – hydrogen.

‘This could be our big moment to become a leading figure in green technology but sadly the Chancellor’s commitment of creating just 140,000 green jobs is a drop in the ocean and is very much restricted to within the building trade.

‘It’s an industry that is set to see incredible growth over the next five years so investing in this area will help the economy grow so we can bounce back faster.

‘The jobs retention scheme seems promising, but I fear it is open to abuse from businesses who were due to bring staff back anyway and who will now be able to benefit from this scheme without needing it. 

‘The scheme needs to be more focused so the companies that truly need the support can access it.’

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