Deloitte Webinar Responding to COVID-19: Updates and practical steps - Cambridge Network
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Deloitte Webinar Responding to COVID-19: Updates and practical steps
COVID-19: current picture
Dr Jane Halpin, Clinical Lead, Deloitte
2Coronavirus case trajectories, by country
Impact of different suppression strategies
FT graphic John Burn-Murdoch / @jburnmurdoch
3
Source: FT analysis of Johns Hopkins University, CSSE; Worldometers; FT Research. Data updated 24 March 19.00 GMTCoronavirus cumulative deaths, by country
Impact of different suppression strategies
FT graphic John Burn-Murdoch / @jburnmurdoch
4
Source: FT analysis of Johns Hopkins University, CSSE; Worldometers; FT Research. Data updated 24 March 19.00 GMTMarkets and economy
Maximilien Lambertson, Deloitte
Economist
5Monetary policy seems to be having an effect
6High frequency data highlight scale of shock to real economy
Source: OpenTable data covering restaurants in Australia, Canada, Germany,
Ireland, Mexico, UK and US
7Policy response aimed at preserving capacity
Key policy responses in a selection of developed economies:
Monetary policy Fiscal policy
Rate Asset purchases and Lending for Tax relief for Job/income
cuts liquidity support businesses businesses support
scheme
Unlimited QE, corporate bond
US Yes purchases, short-term loans to TBA TBA TBA
banks
Expanded QE, schemes
UK Yes
targeting banks and corporates
Yes Yes Yes
ECB sovereign and corporate
France No
bond purchases
Yes Yes Yes
ECB sovereign and corporate
Germany No
bond purchases
Yes Yes Yes
No(Rate
Denmark rise)
Macro-prudential easing Yes Yes Yes
Korea Yes Short-term loans to banks Yes Yes Yes
8Where to look for green shoots?
New daily Covid-19 cases in Italy
9
Source: Worldometers.infoOverview of government funding
initiatives for businesses
Jodi Birkett
10Government funding
Coronavirus Job Retention Scheme (“CJRS”)
Funding Go live
What is it? Eligibility Amount Access Recommendations
category date
Coronavirus • Employers • All UK employers HMRC will Workers New online portal • Check further guidance when
Job designate with a PAYE reimburse 80% of ‘furloughed being built by HMRC released
Retention employees as scheme furloughed workers ’ from 1 to make applications • Consider contractual re-
Scheme ‘furloughed • Uncertainty wage costs, up to a March 2020 negotiations now
workers’ whether agency cap of £2,500 per
• Take care making promises of
• Employer pays workers on PAYE month per First
what salary payments the grant
the workers are included employee payments
can fund until clarity over how the
expected
• Employer claims • Employees must calculations will work (e.g. in
by end of
reimbursement not work during relation to Employer NIC)
April
from the furlough • Furloughing some workers may be
government favourable to reduced hours for
all, but beware discrimination
risks
11Government funding
Funding packages
Funding Go live
What is it? Eligibility Amount Access Recommendations
category date
Coronavirus • Bank loan • Borrower is UK-based in its business c.£5k- 23 • One of the 40+ banks • Details are being published by
Business • 80% activity; £5m March listed by the British individual lenders
Interruption guaranteed • Annual turnover < £45m; and 2020 Business Bank • Potential borrowers should
Loan Scheme by • “Normal” application to engage with their current
• Requirements:
(CBILS) Government the lender lender (in the first instance)
• Supportable business model,
were it not for the current • The lender should
pandemic; and consider whether it will
extend finance and if
• the provision of finance will not, whether the support
enable the business to trade of the CBIL scheme
out of any short-to-medium would change that
term difficulty decision
There is currently no provision for Companies with Turnover >£45m but sitting below the scale / financial position required to be equivalent to an investment
grade rating
Covid • Commercial • Make a material contribution to the £1m+ 23 • Any bank which can • If a Company has a sufficient
Corporate paper issued UK economy March issue commercial paper rating in place (prior to 1
Financing through a • Business must be of “Sound financial 2020 • Application forms March 2020), it can apply for
Facility bank, health” (determined by credit rating) available on the BoE funding
(CCFF) purchased website • If not, a Company should
• Where a Company does not have a • Once eligibility is
by the Bank speak to its existing lenders to
rating, then the BOE may be able to confirmed by the BOE, it
of England understand if their internal
use your current lenders internal should be possible to
rating as evidence rating may be sufficient
issue paper quickly
• Cannot be a Bank, Building Society (following working day) • Look at BoE website, with
or Insurer or other sector regulated by further details on process and
the FCA required documentation
12Government funding
Overview of key packages
Grants for retail, hospitality Rates relief Ban on evictions for
and leisure businesses 100% business rates discount for retail, commercial tenants who miss
hospitality and leisure businesses
£25,000 grant per property (with rateable
Empty rates property tax exemption
rent payments
value between £15,000 and £51,000) Protection for 3 months if due to
Recommendation: Coronavirus
100% business rates relief: no action Recommendation:
Recommendation: No application is necessary
Contact Economic Development Officer at required, should be automatically applied
Empty rates: needs to be applied Commercial tenants should engage with
local town or city council landlords
Time to pay arrangements Deferral of VAT Income tax payment deferral
(TTP) Next quarter’s VAT payments are deferred Income tax payments due on 31 July 2020
Defer current tax debts to instalments over can be deferred to 31 Jan 2021
a 3-12 month period
Recommendation: Recommendation: Recommendation:
Contact CCM / ring helpline Suspend direct debit arrangements for VAT Payments to be deferred only where
Be prepared payments for the period of deferral payments cannot be reached
13For more information
deloitte.co.uk/covid19govfunding
businesssupport.gov.uk
14Questions
15ukpages.deloitte.com/COVID-19-task-force-
and-Deloitte-Intelligence-Registration.html
For further information…
16This publication has been written in general terms and we recommend that you obtain professional advice before acting or refraining from action on any of the contents of this publication. Deloitte LLP accepts no liability for any loss occasioned to any person acting or refraining from action as a result of any material in this publication. Deloitte LLP is a limited liability partnership registered in England and Wales with registered number OC303675 and its registered office at 1 New Street Square, London, EC4A 3HQ, United Kingdom. Deloitte LLP is the United Kingdom affiliate of Deloitte NSE LLP, a member firm of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”). DTTL and each of its member firms are legally separate and independent entities. DTTL and Deloitte NSE LLP do not provide services to clients. Please see www.deloitte.com/about to learn more about our global network of member firms. © 2020 Deloitte LLP. All rights reserved.
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