Budget ‘hardship fund’ for coronavirus-hit firms

THE Chancellor is expected to announce financial handouts for businesses affected by coronavirus in tomorrow’s Budget, as the London stock market suffered its biggest crash since the financial crisis.

Last night, the FTSE 100 index closed down 7.69 per cent, wiping more than £124billion off the value of the City’s biggest listed companies in a day of brutal trading labelled a “new Black Monday”.

Rishi Sunak will use his first Budget to bring in a package of measures to limit the economic impact of the virus.

The Treasury has discussed underwriting bank loans to encourage lending to businesses that are affected by the fallout from coronavirus. Small busi- nesses could be given loans at cheap interest rates, as in measures introduced after the financial crisis.

A source close to the talks told The Daily Telegraph: “The long-term aim is making sure profitable businesses don’t go bust.”

A “hardship fund” could also be set up to provide cash help for those businesses that are worst affected by the epidemic, two sources told The Telegraph.

It is understood the hardship fund could be designed to help businesses which banks would refuse to lend to. In some cases businesses could be given cash which they would not need to repay until a later date.

Meanwhile, oil prices tumbled by almost a third in the sharpest fall since the 1991 Gulf War.

However, Donald Trump, the US President, dismissed the connection to coronavirus and said such reports were “fake news”.

He said: “Saudi Arabia and Russia are arguing over the price and flow of oil. That, and the fake news, is the reason for the market drop.”