In response to the Chancellor’s Budget statement, Alexandra Withers, North East chair of insolvency and restructuring trade body R3 and an associate solicitor in the insolvency department of Short Richardson & Forth Solicitors in Newcastle, says: “The Chancellor’s decision to extend the furlough scheme, to provide further business grants and a new loans scheme, and to continue the business rates holiday will give welcome certainty for many North East business owners concerned at their prospects over the coming months.
“What was missing, however, was detail about the Government’s role once these measures start to be withdrawn.
“As a key creditor in most corporate insolvencies, the Government has a direct role to play in supporting viable restructuring and business rescue proposals.
“HMRC in particular has not always taken a constructive approach to these proposals, and we would like to see this change sooner rather than later.
“By taking a more active and engaged stance as a creditor, the Government could help to save more potentially viable businesses, thereby safeguarding thousands of jobs, securing future tax income, and giving companies a chance to deal with liabilities resulting from the pandemic.
“There’s no denying the Government’s pandemic measures have helped businesses in the short-term, but as the Chancellor pointed out, these can’t last forever.
“Directors and owners of struggling companies now have a few months in which to start making plans and taking decisions to secure the future of their businesses, and we would urge them to use this time to seek advice from a qualified source as early as possible, to give them the broadest range of options for resolving the issues their businesses face.”