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Jersey Government and boosting the confidence of business owners | Covid-19

Comment on Jersey Government measures on Covid-19 | Jersey Legal Services


Those avidly following the latest updates regarding Covid-19 will have noted, with some sadness, that the celebrations for the 75th anniversary of Liberation Day are cancelled. Perhaps not the most pressing issue in among health and economic concerns, and perhaps a celebration of freedom may not be entirely apt for many of us self-isolating. Nevertheless, contemplation of the trials and tribulations faced by our parents, grandparents and great-grandparents during the 1940s may serve as a compelling reminder of our island’s resilience in tough economic and social conditions.

Many will recall the tales of Dunkirk, and the legendary evacuation of 300,000 troops from France. Others will recall Operation ‘Ariel’ or ‘Little Dunkirk’. As German forces advanced through France into Normandy and Brittany, hundreds of thousands of Allied troops were trapped, and the British Admiralty organised a rescue mission to evacuate them from French ports, including St Malo. Small boats were deemed vital in the rescue mission, to pick up soldiers in the shallows and transport them to the larger ships in the deep water.

A request was passed from the Admiralty, to Jersey’s Lieutenant Governor, to the Commodore of St Helier Yacht Club, requesting that Jersey send all available craft to St Malo to rescue the troops. A raft of small craft, volunteer skippers and crews were hastily assembled. Many were teenagers, others elderly. None knew what to expect on the other side. The first flotilla left at midnight, the second at first light.

None of the lighthouses or navigational aids in the Channel Islands were in use, and virtually none of the boats were equipped with radios. Nevertheless the fleet made it, successfully executed their mission, and left St Malo with German troops less than 9 miles away.  Some of the smallest boats took 20 hours to battle back to Jersey. But they did make it!

How does this relate to our present circumstances?

Collaboration, courage and teamwork. Very few of those who set out in those small boats from Jersey were fit, able-bodied or experienced in adverse conditions.

Those following the Covid-19 preparations will be concerned as to the ability of small businesses and individuals to cope in the uncertain economic times ahead. There will be businesses in good shape, young businesses, old businesses and businesses limping along.

Like those small boats, some will need to be patched up, given direction by others, and kept afloat if they are to carry us all safely to the other side.

Jersey Government Lifeline packages

Jersey’s government have announced a £180 million package of measures to support local businesses in the midst of the Covid-19 pandemic.

Two schemes are intended:

  • the Jersey Disruption Loan Guarantee Scheme supporting new lending to viable businesses unable to extend their current bank borrowing; and
  • the New Special Situations Fund aimed at larger companies which “can be clearly identified as delivering a wider public good or strategic purpose”.

At present the proportions of funds proposed to be delivered to small and large businesses respectively are unclear. It appears that £50 million will be applied to each scheme initially, albeit that little or no detail has been received as to how the extra £80 million will be distributed.

There are no caveats as to whether state-owned and state-governed companies are to benefit from the funds distributed under the umbrella of the New Special Situations Fund, or whether these funds will be allocated primarily to independent local large businesses.

In the UK, for businesses, the £330 billion package announced by Chancellor Rishi Sunak includes, but is not limited to:

  • for some small and medium-sized business at the greatest risk of collapse, an increase in loan limits from £1.2 million to £5 million with no interest due for six months;
  • a three month mortgage holiday for homeowners;
  • cash grants for small firms in retail, hospitality and leisure sectors of up to £25,000; and
  • relief from tax on business premises for an entire year.

Further, the Chancellor has advised that further financial assistance above and beyond the 15% of the current GDP will be made available as and when needed.

Jersey Government measures – will these boost the confidence of business owners?

The measures proposed by Jersey’s government are currently awaiting States Assembly approval, but it is encouraging that our government is considering these measures ahead of school closures at the end of this week, and ahead of any draconian measures which may be imposed should the situation follow its anticipated trajectory.

A former Jersey Treasury politician has advised that in previous times of strain, Jersey has sought to track the UK, matching each billion spent by the UK with one million spent by Jersey’s government towards the same ends. It stands to reason therefore that Jersey can reasonably be anticipating government lending in excess of circa £330 million to correspond with the UK government lending of £330 billion.

That said, in these early days, the initial pledge of funds it is a welcome initiative which will undoubtedly boost the confidence of business owners and employees alike as we head into previously uncharted waters. One can only hope the States of Jersey does not play its usual games of politics and is genuinely focused on assisting us all.

All the boats need to survive this storm: big and small.  We are relying on you Jersey Government.


Useful sources of information

Jersey https://www.gov.je/Health/Coronavirus/Pages/CoronavirusInformation.aspx

UK https://www.gov.uk/government/topical-events/coronavirus-covid-19-uk-government-response

International https://www.who.int/emergencies/diseases/novel-coronavirus-2019

 

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