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IN DEPTH: 20 sectors lose out on 80% wage subsidy

IN DEPTH: 20 sectors lose out on 80% wage subsidy

Friday 27 March 2020

IN DEPTH: 20 sectors lose out on 80% wage subsidy


The government has unveiled plans to support some local businesses during the virus crisis by subsidising 80% of their workers’ pay, up to a ceiling of £1,600 a month - but it’s since emerged that many sectors won't benefit from the £100m scheme.

Announced yesterday, the new scheme is said to co-fund a large chunk of 27,000 workers’ pay packets – half of the island’s workforce.

The £100m package was revealed yesterday at a press conference with Economic Development Minister Senator Lyndon Farnham, External Relations Minister Senator Ian Gorst and Social Security Minister Deputy Judy Martin.

It will run from April to June of this year and will cover 80% of certain workers’ pay packets up to £1,600 a month. In June, the scheme will be reviewed and can be continued if the current crisis persists. The main sectors which seem to be covered are hotels, restaurants, cafes, bars and some shops. 

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Pictured: The new measures were announced yesterday at a press conference with three Ministers.

Applications for payments under this scheme can be made through Customer and Local Services in La Motte Street starting from 1 April.

Hailed as “the most comprehensive package that the Government has ever put in place to support our economy” by Economic Development Minister Senator Lyndon Farnham, it has now emerged that 20 major local sectors won’t benefit from the large subsidy proposed.

The industries which won’t be covered by this co-funding scheme are: 

  • Local agricultural activities and wholesalers;
  • Information and communication services;
  • Advertising and market research;
  • Medical and dental care facilities (that are not shut down);
  • Wholesale of agricultural goods;
  • Supermarkets, pharmacies, grocery stores and fuel retailers;
  • Postal and courier services;
  • Veterinary services;
  • Social and residential care services;
  • Security services;
  • Financial, legal, accounting, management and professional services;
  • Property development;
  • Employment agencies and HR services;
  • Freight and water or air transport;
  • Utility companies;
  • Food and beverage producers;
  • Consultancy services;
  • Primary and secondary education (excluding nurseries);
  • Office administration and support;
  • Government-owned entities or any organisation that is in receipt of a grant or subsidies over £50,000 from the Government (can be included in exceptional circumstances). 

The Government also say that the construction industry is not currently included either, but will be considered depending on the changing health advice and other restrictions.

Adding to their list of excluded sectors, the government states that it “recognise[s] that some businesses will not easily fit within [the] definitions and further guidance on definitions will be published or enquiries can be made through a central email address to be established".

Explaining its rationale for excluding the above sectors, officials said these industries are “not likely to be significantly affected by covid-19 in the short-term” and that “the scheme will be reviewed after the first three months of operation".

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Pictured: Certain businesses deemed "not likely to be significantly affected" by the outbreak have been excluded from the scheme.

For its charitable support, the government will be releasing more than £3.5m from the Channel Island Lottery Fund and the Jersey Reclaim Fund to support charities working to protect those at risk.

This, the Economic Development Minister said, will be administered by an independent body. He said the criteria for selecting that independent organisation was yet to be finalised when asked by Express.

More detail has also emerged about the initial business measures announced as the ‘first phase’ of support last week (Wednesday 18 March). 

The £50m loan guarantee scheme will see the Government cover the repayment of any new bank lending and overdrafts for businesses if needed. This is due to launch on Monday (30 March) and will be accessible through Jersey Business.

The £50m ‘Special Situations Fund’ for large organisations that deliver public goods, serve a strategic purpose or are important to the recovery of the island after the outbreak is for grants loans or equity interests over £1m.

Applications for this fund will be made to the government and considered on a case-by-case basis. In certain situations, the fund will consider applications over £500,000.

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Comments

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Posted by Symon Smith on
Disappointed,
Posted by Jon Needham on
Why would need to subsidise activities which will largely continue with business as usual ?
Posted by Jon Jon on
When you see the money wasted over the years by this government ,simply the money isn't there ,one thing ,when all this has passed we are all going to be paying for it in high taxes.
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