The Confederation of British Industry (CBI) has warned the Government that failure to act fast on COVID-19 support will “stunt UK economic recovery”.
According to the organisation, a soft landing for the UK is needed to avoid a “crash crunch” in April this year.
The news comes as a report by the Resolution Foundation revealed although firm insolvencies have fallen and cash reserves have risen during the COVID-19 crisis, corporate debt-to-GDP is still “well below” levels seen during the 2008 financial crisis.
In order to address this, the foundation is calling for an extension to the coronavirus job retention scheme beyond April, business rates relief until late June, and a delay to the start of VAT deferral payments.
Tony Danker, CBI director-general, said the UK needs extended business support to recognise the “true health and economic picture.”
He said:
“We need a blend of long-term policy clarity and the right incentives to ensure businesses invest.
“Without this vital policy bridge, we will fail to create a platform for a better decade enabled by strong economic growth.
“That is the best way to help the UK emerge from this crisis, compete successfully in the world, and achieve sustainable public finances.”
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