71% of UK businesses have furloughed staff

Seventy-one per cent of businesses have furloughed a proportion of their workforce, up from 66% a week earlier, according to a new survey by the British Chambers of Commerce (BCC).

The figures come on the last day that UK businesses can claim for furloughed staff through the Coronavirus Job Retention Scheme (CJRS) if they need to receive payments by the end of April.
The new data also indicated that 30% of responding firms have furloughed between 75% and 100% of staff, while 59% of the companies don’t have enough cash reserves to last them three months – a figure up from 44% four weeks earlier.

The BCC’s weekly tracker poll, serving as a barometer of the pandemic’s impact on businesses and the effectiveness of government support measures, received 678 responses and is the largest independent survey of its kind in the UK. The latest round of polling was conducted between 15 and 17 April.

Hargreaves Lansdown personal finance analyst, Sarah Coles, commented: “Businesses need to sign up sharpish to the furlough scheme if they’re going to avoid a payday panic. It takes six working days to process claims, so any business furloughing staff needs to get their claim in today at the latest, to have the money ready by the end of the month.

“If they miss the deadline, the cash will still show up, and payments will still be backdated to 1 March, but businesses will have to bridge the gap. Unfortunately, there’s every sign that an awful lot of them can’t afford to bear these costs for long. The survey found that more than half of companies don’t have enough cash to last three months, so they can’t afford a delay.

“The good news is that HMRC seems to have done a phenomenal job of building a system that enabled 140,000 companies to claim for a million employees on day one alone. Now it needs to deliver on its promise to pay within six working days.”

One fintech firm, MarketFinance, has stepped in to help SMEs bridge the gap between paying furloughed staff and waiting for their CJRS claim to be paid by HMRC. The firm said it had pivoted its “tried and tested” model to provide funding against HMRC payroll rebates.

While invoice finance has up until now seen businesses advanced money owed to them in outstanding invoices, MarketFinance revealed it is now offering the same cash flow solution to SMEs looking to advance funds owed in CJRS claims – and that businesses would initially be able to apply for funding facilities up to £150,000.

MarketFinance CEO, Anil Stocker, commented: “With April's payday looming, it is essential that the HMRC application process is smooth and that payments are made as soon as possible. Any delay would exacerbate the cash crisis many companies are facing and could threaten jobs and the survival of these businesses.
“We’ve been advancing cash to businesses since 2011 against invoices with long payment terms. We have perfected this model over the years and, now, in less than 48 hours have quickly adapted our model to meet the current needs of business. These vulnerable businesses, already very short on cash in the bank, will face yet another pressure by having to pay salaries for furloughed employees and then reclaim it days later.”

    Share Story:

Recent Stories

Conveyancing Transformation
Adam Cadle talks to ULS technology CEO Jesper With-Fogstrup about making home moving a pleasant experience


Subscribe to our newsletter to receive breaking news and other industry announcements by email.

  Please tick here to confirm you are happy to receive third party promotions from carefully selected partners.