Jersey Business, which provides support and guidance to businesses, says the extension of the government's payroll co-funding scheme may not be enough to save all island businesses.While the organisation says the government has "listened to business" and got the balance "about right", it predicts many still have tough decisions ahead.
Inevitably there will be businesses who will really struggle. And actually, in many instances, what those businesses are then forced to do is adapt their business model if they can, if they can't they may have to downsize part of their business or in the worst case scenario we will see some businesses unfortunately have to close.
Last week the government announced the payroll co-funding scheme would be extended until March 2021, on a sliding scale. It has also lowered the detriment test from 30% to 20%, making more people eligible to claim support.A report by the Office for Budget Responsibility in the UK last month predicted as many as 20% of employees on furlough could be at risk of redundancy once the UK furlough scheme closes in October. The payroll co-funding scheme is Jersey's equivalent and currently supports some 16,000 people.Mr Smith said it was difficult to predict the outcome in Jersey, but he also said he thought Jersey was in a better place than the UK when it comes to its recovery.
I think Jersey is in a better place than the UK. I think our finance industry is stronger and in a better position than the UK, and I think the government measures have got it right in terms of how to support. It's not just about the payroll support, it's the other mechanisms that government are doing, but also the good advice I think that we can give to help businesses through.
Jersey Business has advised many businesses throughout the pandemic, and says it is very much on hand to assist further and help them in their decision making process going forward, with the added certainty the co-funding scheme now provides.