Billions to support Scottish businesses, workers and the vulnerable
Pubs and restaurants will be able to operate as takeaways during the coronavirus crisis, as the Scottish Government announced a £1.9bn package of support for businesses.
The announcement of more money stems from the increase in coronavirus funding announced by the Chancellor Rishi Sunak on Tuesday.
A further £350m will be made available for welfare and wellbeing support.
Economic support measures include a £10,000 grant for businesses that are eligible for small business rates relief or in the rural business scheme, and 12 months’ business tax relief and £25,000 grants for properties in retail, hospitality and leisure, as in the rest of the UK.
Legislation on a tourist tax will be stopped for now, and the bottle deposit and return scheme due to be introduced in April 2021 will be delayed for 15 months, to relieve the regulatory burden on businesses.
The Cabinet Secretary for the Economy Fiona Hyslop told MSPs the global economy could shrink by five per cent in three months. She said: “We are treating it as an economic emergency triggered by the enormity of the health emergency."
She laid out three priorities: to keep companies going, keep staff in employment and support staff to self-isolate.
She confirmed that all consequentials from the Chancellor’s announcement would be passed on in full to support businesses and employers.
The £350m of funding for welfare and wellbeing will be made available to councils, charities, businesses and community groups.
This includes £45m for the Scottish Welfare Fund to provide crisis grants and community grants, more than doubling its value, with more flexibility in how it is used; a £70m food fund for households, to be administered by local authorities, which can be used in part to help families no longer able to access free school meals; £50m more for anticipated increases in applications for social security payments and the Council Tax Reduction Scheme; and £50m for the Wellbeing Fund to help third sector organisations help those facing challenges such as homelessness or fuel poverty.
Speaking in the Scottish Parliament, Communities Secretary Aileen Campbell said that legislation would be changed temporarily so that landlords could only move to evict tenants after six months of non-payment of rent, as opposed to the current three. She urged landlords having difficulty paying mortgages to take advantage of the three-month mortgage holiday announced by the UK Government and said the Scottish Government would urge UK Finance and the UK Government to extend it to six months.
Campbell said: “Our funding package will be focused on delivery, not bureaucracy or red tape. Local authorities, local businesses, community groups and the third sector know and understand the support needs of their communities the best. Where people and organisations have solutions or ideas, I want to hear them.
“Unless we work with local partners the impact of our investment will not be felt by those that need it most. So my message today is – if we can help you to help the people of Scotland then we will.”
She urged local groups who were coming together to respond to the emergency to let the Scottish Government know what they needed and promised swift provision of resources, announcing three examples agreed on Wednesday.
They are: £80,000 to allow an expansion of Age Scotland’s helpline capacity; £500,000 for the social enterprise Social Bite to facilitate the provision of up to 3,000 free meals a day in Glasgow, Edinburgh and Aberdeen; and £65,000 for the Health Agency in Wester Hailes, Edinburgh, to facilitate a buddy system to keep vulnerable people connected by phone and provide food packages to around 400 families.
With well-functioning businesses like restaurants and hairdressers facing a collapse in demand, Hyslop also said individuals could help support their local economy by buying vouchers.
She said: “If you have a local business that you want to see survive and continue to exist on your high street in your town, please think of going and buying a voucher.
“If you have cash, if you have a salary, and you have that capability, and you are saving money because you’re not going out, then please think about pre-purchasing vouchers that support your local community.
“We can have a community social response, but we can also have a community economic response.”
In a response to a question about tackling individuals and companies allegedly profiteering from Covid-19, she said exploitation of the economy at this time was “absolutely inexcusable”.
The Cunninghame North MSP Kenneth Gibson highlighted the experience of Bonnymans, Scotland’s largest producer of alcohol-based sanitising gel, in his constituency, which has seen the price of alcohol supplied to it rocket from £500 to £3,500 a tonne.
Ms Hyslop said that the example showed there were people who wanted to exploit people and companies in very difficult circumstances. She said: “Everything that can be done in relation to competition policy and also to make sure that there isn’t that activity, has to be addressed.”
The Scottish Secretary Alister Jack responded to the Scottish Government’s announcement saying the £1.9 billion cash boost brought Scottish Covid-19 funding to £2.7 billion in total.
He said: “I welcome Nicola Sturgeon’s clear commitment to pass on every penny of this extra funding to support Scottish businesses. Scotland’s two governments are working closely together on a daily, indeed hourly, basis. It is vital that we work together right across the UK.”
Andrew McRae, FSB’s Scotland policy chair, said: “Scotland’s independent businesses will be pleased to hear that there’s a significant £1.9bn package of help on the way. The crucial thing now, though, is to get this support to the front line as quickly as possible. We can’t see perfectly good businesses going to the wall – taking jobs and future tax revenues with them – because of temporary, if acute, cash-flow problems.”
The chief executive of Citizens Advice Scotland Derek Mitchell welcomed the welfare support, saying: “CAS joined with a number of other anti-poverty organisations to call for a significant increase to the Scottish Welfare Fund and our CABs will continue to ensure people are sign-posted towards the scheme.
“A third of people say they would struggle with an unexpected £500 expense so we believe there will be a large demand on this fund so it was vital it is properly resourced.
“Council tax debt is also the biggest debt issue our network deals with, so further support for the Council Tax Reduction scheme is very welcome.
“The average debt our clients owe in Council Tax arrears is over £3,000 – almost three times the average bill.”
Earlier, Shelter Scotland called for the convening of a coronavirus housing and homeless taskforce to tackle the challenges facing those who do not have a home or are worried about losing their home.
In an open letter on Tuesday, Director Graeme Brown said: “The ongoing coronavirus emergency will have deep and lasting impacts over many aspects of society, our lives and our economy. For those people with no home, or about to lose their home, and who cannot simply self-isolate, the risks are even greater.
“Homeless individuals face significant health problems at the best of times – the alarming recent statistics on homeless deaths in Scotland prove as much. However, at a time when a virus such as Covid-19 is circulating rapidly, the need to provide adequate housing to all becomes ever more acute. Not just to keep individuals safe, but also to protect wider society and to provide the space for individuals to be able to self-isolate in line with government advice.
“Adopting a safeguarding approach to protect life, provide people with suitable accommodation, and ensure people can stay in their homes in these unprecedented times is a vital element of how our society responds to this emergency.
“We stand ready to work with the Scottish Government and other partners to make this happen.”