Sunak’s sick pay rescue scheme ‘may come too late for many workers’

SMALL firms have been warned they could go bust before they receive any help from the Government to deal with the coronavirus crisis.

Rishi Sunak used his Budget to announce that the Government would reimburse the cost of statutory sick pay for workers who get the virus.

But yesterday the Institute for Fiscal Studies revealed that small print shows the scheme may not be up and running for months – which could be too late.

It also warned that the economy was not ‘robust’ enough to deal with the crisis if the disease turns out to be more virulent than expected.

The IFS said the country’s growth prospects were ‘gloomy’ even before the virus. A bad epidemic would see the UK’s deficit shooting up, which means stamp duty and VAT receipts would go down. Further falls in the FTSE share index also means lower revenue from capital gains tax and inheritance tax, and lower pension pots.

The IFS said measures announced in the Budget to help tackle coronavirus were ‘timely, targeted and temporary’ but it remains to be seen if they will protect the economy long term.

Mr Sunak unveiled a £12billion package targeted at the impact of the virus as he outlined the Government’s response to the outbreak on Wednesday. He said that the NHS will receive ‘any extra resources it needs’.

The Chancellor said business rates will be scrapped for thousands of small firms in the next year. Statutory sick pay would be extended to all those asked to selfisolate, even if they don’t show symptoms, while the Government will meet the cost for businesses with fewer than 250 staff of providing SSP for 14 days.

But Carl Emmerson, IFS deputy director, said: ‘What is unfortunate is that the Government has said the scheme for getting those rebates is being worked up and will be available in the coming months. ‘That could be too late if some small businesses are very cash strapped – for example if a large proportion of their workforce is affected.’