The Treasury Releases Emergency FundMarch 30, 2020 John Isaac
The gambling industry has not been spared as coronavirus continues to wreak havoc across the globe. This novel pandemic has seen all outdoor sporting events canceled in various parts of the world, leading to unimaginable losses.
Fortunately for the companies based in the UK, the government has launched a relief fund program through its national emergency treasury fund. Announcing this on Friday, Rishi Sunak, Chancellor of the Exchequer, emphasized that the UK is handling covid-19 pandemic with wartime measures to help protect the economy of the country.
Business to Benefit from the Emergency Fund
Together with Prime Minister Boris Johnson, Sunak announced that the Treasury had unveiled a 330 billion emergency fund to help businesses combat the effects of the virus spread. The fund will be availed to banks in terms of government-backed loans.
“That means any business who needs access to cash to pay their rent, the salaries, suppliers, or purchase stock, will be able to access a government-backed loan, on attractive terms,” Sunak said during the press briefing.
Additionally, the government promised to release more funds in case demand rises higher than expected, which is a likely situation if the virus pandemic is not brought under control soonest.
“If demand is greater than the initial £330 billion I’m making available today, I will go further and provide as much capacity as required.”
The funds will help a business pay rent, remit salaries, and pay for other services despite low customer turn out. This, in turn, will keep employees and business owners on the payroll despite staying at home.
The government will distribute the funds in two ways; the large corporations will work directly with the Bank of England, which will establish a new lending facility that will avail low-cost commercial paper to businesses easily.
What Next for the Gambling Sector?
The gambling sector is undoubtedly one of the most hit by the Corona pandemic across the world.
The Betting and Gambling Council (BGC) has requested the government to assist its members with employment costs by increasing time to pay PAYE (Pay As You Earn) and National Insurance Contribution liabilities (NIC).
Michael Dugher, BGC chief executive, said: “Like all other parts of the hospitality, leisure and entertainment industries, the immediate priority for the future of our members in the casino, bingo and betting industry is the ability to pay staff.”
Michael further highlighted that the betting and gambling sector has lost up to 90% of its customers in a matter of two weeks. This has been caused by the massive cancellation of sports as well as quarantine and self-isolation state in several countries.
“We urgently need temporary government support to help cover payroll costs, relief and time to pay duties and taxes, as well as access to finance. The Treasury, in particular, needs to step up and understand that insurance doesn’t cover the impact of a pandemic.”
In response, the Chancellor Sunak said: “This means every single shop, pub, theatre, music venue, restaurant – and any other business in the retail, hospitality or leisure sector – will pay no business rates whatsoever for 12 months, and if they have a rate able value of less than £51,000, they can now get a cash grant as well.
He further added: “I also announced last week that we would be providing £3,000 cash grants to the 700,000 of our smallest businesses.”