One million UK businesses have claimed £15bn from the government’s coronavirus job retention scheme to cover the wages of 8.4 million furloughed workers, official figures show.
The Treasury also unveiled a big jump in the number of approvals for its Bounce Back Loans, which are aimed at helping small businesses to navigate the coronavirus crisis.
The loans, valued at up to £50,000 and 100% guaranteed by the government, have proved to be far more popular than the original Coronavirus Business Interruption Loan Scheme (CBILS), which was plagued by delays and complaints.
As of last Sunday, just over 600,000 Bounce Back Loans had been approved to the value of £18.49bn.
By the same date, some 43,000 loans had advanced £8.15bn under the CBILS.
The CBILS for larger businesses approved £820m for around 150 successful applications.
The schemes are administered by banks and Alison Rose, chief executive of NatWest Group, said the government guarantee was just part of the attraction for smaller businesses, along with the scheme’s quicker processing time, efficiency and there being fewer conditions to satisfy.
She told Sky News’ Ian King Live programme that help for larger companies was being processed quickly enough.
Ms Rose said: “If I look at the amount of support we’re putting in place, we’ve advanced £2.6bn for the CBILS loans to larger companies.
“What you’re seeing is that they’re taking those loans but also the other help we’ve put in place: a £5bn working capital fund, increased overdrafts or capital repayment holidays.
“I think as a business owner you’re making a decision: do I want to take on more debt? Do I want to get more breathing space by bridging working capital? Or do I just want to wait and see? So I think it’s across that whole range of measures and ultimately the business owner will decide whether they want to take on that additional lending.”
In March, Chancellor Rishi Sunak announced government grants would cover 80% of the salary of staff kept on by their employer but unable to work due to the lockdown.
The coronavirus job retention scheme covers wages up to £2,500 a month.
The latest figures from the Treasury show that by 24 May, 8.4 million jobs had been furloughed by a million employers with claims of £15bn made. This is up from 3.8 million jobs and £4.5bn a month ago.
Mr Sunak is expected to ask businesses to contribute 20% of this cost soon.
Ms Rose said: “I think the furlough scheme has been a helpful process to bridge through as we start getting the economy unlocking and people getting back to work.
“Businesses are going to have to evaluate what they need going forward and getting back to a new business as usual.
“I think all businesses are having to evaluate whether they need the some people, how quickly they will be able to get business back on track…I think businesses are going to be facing really tough choices on what they implications are of the lockdown and the economic outlook.
“We’re already starting to see a number of big and smaller businesses announce redundancies as we size for what the future outlook will be.”
Next week from Monday to Thursday, Dermot Murnaghan will be hosting After the Pandemic: Our New World – a series of special live programmes about what our world will be like once the pandemic is over.
We’ll be joined by some of the biggest names from the worlds of culture, politics, economics, science and technology. And you can take part too. If you’d like to be in our virtual audience – from your own home – and put questions to the experts, email email@example.com