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Creative and biz leaders react to British government paying 80% of coronavirus impacted workers wages

Creative and business leaders react to British government paying 80% of coronavirus impacted workers wages

Creative sector and business chiefs have responded positively to chancellor Rishi Sunak’s move to take “unprecedented” steps to save jobs and avoid many companies folding during the Coronavirus pandemic.

Announcing the intention to cover 80% of salaries for employees, up to £2,500 per month each, for an expected period of three months in order to keep the economy from collapsing, Sunak has drawn praise from business leaders.

Dame Carolyn Fairbairn, Confederation of British Industry (CBI) director-general, describes the announcement as “a landmark package of measures for business, people and jobs."

She continued: “The chancellor’s offer of substantial payroll support, fast access to cash and tax deferral will support the livelihoods of millions. Firms and employees will respond with relief and determination,” adding that this would be the start of the UK’s economic fightback and “an unparalleled joint effort by enterprise and government to help our country emerge from this crisis with the minimum possible damage. An important day for our country.”

Prime Minister Boris Johnson also announced that bars, cafes and restaurants would also close from today (20 March) as another measure to stop the spread of the virus, but that takeaway deliveries would remain available. Shops would not be ordered shut he later confirmed.

Sunak also called on businesses to avoid making redundancies in order to save for the short term: “The government is doing its best to stand behind you and I'm asking you to do your best to stand behind our workers," he stated.

Elsewhere, Stephen Woodford, CEO of the Advertising Association said: “This is an extensive set of measures taken to reassure businesses across all industries that the Government is fully prepared to back employers and their employees through this crisis. The government is listening and we have had numerous conversations with Government this week to provide information to help shape the decisions that have been made. The relief offered to SMEs, in particular, will be received positively by many in UK advertising. Our industry is made up of a great number of small, specialist companies and we have them to thank for the hugely creative and entrepreneurial work they do on behalf of UK and international advertisers.”

He described the last few days since the Coronavirus reached the UK as “seismic” and predicted further changes and challenges to come. “It is particularly urgent to see action next to support the extensive freelance community in our industry and across the economy. Looking at the positives, we have already seen our industry responding and reacting with creative work to back our NHS, our Government, our retailers and other key workers who are working right at the heart of this crisis. I am certain we will see more over the coming weeks of a brilliant collective effort from all in UK advertising to do their utmost to support the people who most need our help in this crisis, in whatever ways we can responsibly do so.”

Phil Smith, director-general of ISBA, described their support for businesses, employees and family incomes as “extraordinary”.

He continued to welcome today’s announcement: “At this moment ISBA stands with its members, their employees, and families. We are pleased with the contact with government and continue to use our regular calls to highlight challenges as they emerge and to ensure that we all, as an industry and society, come out of this unprecedented period as strongly as possible.”

Nick Rhind, chief executive officer of CTI Digital admitted that he was relieved at the measures taken which were “a massive step in the right direction” to protect the future of companies and their employees.

“The loan facility that was offered earlier in the week felt that it could be a Wonga loan to give short term relief but a long term debt we might not get out of and certainly not in six months to turnaround the damage,” he explained.

“The 80% contribution, although capped, will make a huge difference in front line staff. Many can work from home in companies but some front line roles it's impossible. This allows companies to offset the costs and loss of efficiency they are going to have and not resort to cutting staff to keep the core business.”

Rhind continued: "12-month interest-free loans give an opportunity to all companies to have a chance of survival and plan a longer-term turnaround,” he added of another element of the chancellor’s new financial measures.

“Moving VAT gives companies a chance to sort their cash flow and time to adjust their costs where needed without further in debt where I would hope good employers would protect their staff well being and help with moving to be more remote and the facilities needed to do so and invest in that.”

However, not everyone was entirely satisfied by Sunak’s efforts, with Caroline Norbury, chief executive officer of the Creative Industries Federation, outlining the lack of measures to protect freelance and self-employed workers.

“The chancellor’s announcement tonight that the government will pay wages up to 80% for businesses will be very much welcomed by the UK’s creative businesses, many of whom have had to shut their doors overnight. However, this creates a worrying inequity between those who now have their income secured and the UK’s 5 million self-employed workers and freelancers who are left despondent.”

Norbury claimed that a third of the creative workforce was freelance and that the universal credit allowance would not compensate for their losses.

“We stand by all of the creative industries and, at this challenging time, it’s vital the government stands by our self-employed and freelancers, and mirrors the strong measures put in place for the UK’s employed workforce.”

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