The Welsh First Minister, Mark Drakeford, has announced a new £500m fund to provide extra support to the Welsh economy, businesses and charities experiencing a sharp drop in trading as a result of the coronavirus pandemic, reports local news service, Wrexham.com
The Economic Resilience Fund is aiming to “plug the gaps” in the UK Government’s support schemes already announced, which will guarantee 80% of people’s wages and income.
Firms of all sizes can potentially be helped via the new £500m Welsh fund, which is to focus on those which have not already benefited from the coronavirus grants already announced by the Welsh Government.
Mr Drakeford said during his daily brief: “Throughout last week, my cabinet colleagues and army worked to reprioritise the Welsh government’s budget and we’ve done that to free up as much funding as possible to ensure that Welsh public services and Welsh businesses have all the support that we can offer them. The result of that reprioritisation exercise is that we have a 1.1 billion pound fighting fund to respond to those specific Welsh needs. And today I’m able to announce that we have created a 500 million pounds economy crisis fund to provide extra support for businesses. charities, and social enterprises.”
“The recent announcements by the UK Government provided some much-needed protection for many workers and their families in Wales. But even with these interventions, there are elements of the economy, businesses and charities in Wales facing insolvency because fixed and operating costs – rent, residual salary costs, leasing charges for vital equipment and maintaining operations – cannot be met during this crisis.
“We made a commitment as a Welsh Government to fill the gaps and support the economy and businesses through this incredibly difficult time. This package of support provides further assurance to firms, charities and social enterprises that we will do just that – help them deal with the economic impact of the pandemic.”
The £500m fund is made up of two main elements:
A new £100mn Development Bank of Wales fund for companies experiencing cashflow problems which stem from the pandemic, offering loans of £5,000 – £20,000 at favourable interst rates.
Grants of up to £10,000 will also be made available for micro-businesses employing up to nine people, including sole traders who employ staff. Qualifying businesses can apply from mid April. SMEs with 10 – 249 employees can apply for grants of up to £100,000. There will also be support for larger Welsh companies ‘which are of critical social or economic importance to Wales.
The £500m Economic Resilience Fund will support businesses forced to temporarily cease trading – to go into “hibernation” – or which need cash-flow support to adapt to a remote way of working. The new fund builds on the £1.4bn business support package announced by the Welsh Government which provides a year-long rate relief holiday for all but the largest premises in the retail, hospitality and leisure sectors and grant-support for more than 70,000 small businesses.
