Asked by: Baroness Randerson (Liberal Democrat - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government what plans they have to increase the funding available through the COVID-19 Corporate Financing Facility; what plans they have to extend the term for such loans beyond 12 months; and how they intend to make such loans more accessible to the aviation industry.
Answered by Lord Agnew of Oulton
The Covid Corporate Financing Facility (CCFF) was set up in March 2020 to provide short-term liquidity for fundamentally strong firms. It was introduced during a period of exceptional volatility in financial markets to support corporate markets and ease the supply of credit to all firms.
As corporate credit conditions are increasingly supportive, the CCFF will close to new issuance from 23 March. Firms that have already accessed the scheme and meet the requirements are able to extend their loans for up to twelve months, providing funding until March 2022.
The CCFF has helped large corporates across a range of sectors, including the aviation industry. In total, the CCFF has provided over £34bn of support to some of the UK’s largest firms, directly supporting businesses responsible for almost 2.5 million jobs in the UK.
The Government recognises the challenging circumstances facing the aviation industry as a result of Covid-19 and HM Treasury continues to support the Department for Transport’s work leading the Global Travel Taskforce to facilitate a resumption of international travel. Firms can draw upon the unprecedented package of measures announced by the Chancellor, including flexibilities with tax bills and the extended furlough scheme. The aerospace sector and its aviation customers are also being supported with almost £11 billion made available through loan guarantees, support for exporters, and grants for research and development. This includes £8bn of UK Export Finance Guarantees.
Asked by: Steve Baker (Conservative - Wycombe)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will (a) extend and (b) review the Coronavirus Job Retention Scheme to ensure people working in the aviation industry are effectively supported.
Answered by Jesse Norman
The Government recognises the challenging times facing the aviation sector as a result of COVID-19. Firms experiencing difficulties as a result of COVID-19 can draw upon the unprecedented package of measures announced by the Chancellor, including schemes to raise capital, flexibilities with tax bills, and financial support for employees.
The Coronavirus Job Retention Scheme (CJRS) is a temporary scheme in place for 8 months starting from 1 March and ending at the end of October.
As of midnight 28 June 2020, the CJRS has helped 1.1 million employers across the UK furlough 9.3 million jobs, protecting people’s livelihoods.
As the Chancellor set out in his letter to the aviation sector, should individual firms still find themselves in difficulty after exhausting all other options, the Government is prepared to enter negotiations with them as a last resort. Any intervention would need to represent value for money for taxpayers.
Asked by: Grahame Morris (Labour - Easington)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will extend the Coronavirus Job Retention Scheme to include people employed in the aviation sector to the end of 2020.
Answered by Jesse Norman
The Government has extended the Coronavirus Job Retention Scheme until October 2020. Extending the scheme in its current form until July will provide workers, businesses and the economy with clarity on this vital support. After July, the Government will introduce more flexibility to the furlough scheme in a measured way that protects people’s incomes and helps support furloughed employees as they return to work. From August through to the end of October, employers currently using the scheme will have more flexibility to bring their furloughed employees back to work part-time while still receiving support from the scheme. Employers using the scheme will start contributing some of the costs of their workers’ salaries, substituting in part the contribution that the Government is currently making. The Government will outline more details of how this will work by the end of May.
It is the case that some firms will be affected by coronavirus for longer than others, and the Government will seek to support these firms appropriately. It would be challenging to target the CJRS to specific sectors in a fair and deliverable way, and it may not be the case that this is the most effective or sensible way to provide longer term support for those sectors most affected by coronavirus.
The Government will continue to monitor developments and engage with affected sectors, with the aim of ensuring that support provided is right for these sectors and for the economy as a whole.