Coronavirus: Supporting Businesses and Individuals

Ben Lake Excerpts

Tuesday 23rd February 2021 Commons Chamber

[Ben Lake (Ceredigion) (PC)]

Diolch, Madam Deputy Speaker, for calling me to speak in this important debate, in which we have heard a surprising amount of consensus from both sides—in between a few rhetorical flourishes.

Plaid Cymru would welcome the extension of the 5% reduced rate of VAT, but believes that the measure should be extended for the entirety of the forthcoming financial year. Members will of course be familiar with the dreaded three-winters scenario that many in the hospitality sector have suffered. Although the vaccination programme’s progress to date is very promising, we remain in its early stages. At this point, it is difficult to predict how things will develop in the coming months, so extending the VAT reduction for the entire financial year would offer welcome certainty, as well as boosting the sector and helping businesses to get back to their feet. That is particularly pertinent in the economically marginalised areas that are less likely to benefit from large-scale public projects. In Ceredigion, for instance, the hospitality sector employs approximately 4,500 workers, or 16% of the local workforce. Just as important, of course, are our high streets, which deserve and should get our support, so I hope the Chancellor will consider extending the business rates relief package when he unveils the Budget next week.

There is also an urgent need for the Government to look again at the framework for the repayment of Government-guaranteed debt. UKHospitality has estimated that the sector lost around £72 billion in sales in 2020 and faces, frankly, a debt mountain, including £4.2 billion in state-backed loans. It is therefore important that businesses that took out bounce back loans and CBILS are required to pay only when they are in a position to do so—in other words, when they have bounced back from the pandemic. Affording such a level of flexibility, and thus preventing avoidable business failures, would help to protect jobs, the taxpayer’s investment in the recovery and the integrity of our financial system. I hope the Chancellor will recognise that in his Budget.

Finally, I urge the Government to maintain the furlough scheme, to give employees and employers security as our economy adjusts. The scheme should be phased out only once both the pandemic and the prevailing economic conditions have stabilised; to do otherwise would risk undermining its very success in having protected jobs and risk stifling any nascent economic recovery. I also add my voice to those calling for an extension of the self-employed income support scheme, including the expansion of the eligibility criteria called for in the motion, and for an equivalent director support scheme so as to offer support to those who have thus far not received a penny.

Having done so much to protect the economy and the workforce, we must not withdraw support prematurely, as to do so would risk throwing away vast amounts of taxpayers’ money and potentially our economic recovery.