NAVCA Budget 2021 Summary
NAVCA have rounded up the Budget news and hopefully covered the key areas that will be of interest to you, your organisation and your networks.
What do we know
Coronavirus Job Retention Scheme (CJRS)
The CJRS (‘furlough’) has been extended to September 2021.
Until then, employees will continue to receive 80% of their wages. Employers will need to contribute 10% in July and 20% in August and September as the scheme is gradually phased out. There are almost 5 million people currently on the furlough scheme. It is unclear how many will have jobs to return to as society opens up across the spring and summer.
Business rates relief
The business rates ‘holiday’ will continue until the end of June 2021. For the rest of the financial year, business rates will be subject to a 2/3 discount, meaning only 1/3 the ‘normal’ business rates will be payable.
Local councils will administer the distribution of this £5bn fund.
Non-essential retail businesses will get up to £6,000 per premises through the Restart Grant scheme to help them reopen. Our understanding is that this will include charity shops. Our friends at the Charity Retail Association are double-checking whether the issue of state aid will have a negative effect on some charities.
Restart Grants will also for hospitality, accommodation, leisure, personal care and gym businesses, which will reopen later and will be more affected by restrictions. The amount available will depend on rateable value. We are seeking clarification from the Government about whether and how this grant can be accessed by charity and voluntary organisations.
According to government guidance, your business may be eligible if it:
However, you cannot get funding if:
An additional £425m will be available for local authorities in England . This can be distributed to businesses not eligible for the “restart grants” but are still suffering because of Covid restrictions. Again, clarification needed on whether this will include charity and voluntary sector organisations.
Domestic abuse programmes
The Chancellor announced an additional £19m for domestic abuse programmes, which have seen a significant increase in demand for support during lockdown.
Armed Forces charities
A further £10m is being made available to provide mental health support for veterans, through the Armed Forces Covenant Fund Trust.
The government will provide also up to £475,000 to Armed Forces charities in 2021-22 to support the development of a digital and data strategy for the sector.
Community Ownership Fund
The £150 million Community Ownership Fund will help ensure that communities across the UK can continue to benefit from the local facilities and amenities that are most important to them.
From the summer, community groups will be able to bid for up to £250,000 matched funding to help them to buy local assets to run as community-owned businesses.
In exceptional cases up to £1 million of matched funding will be available to help establish a community-owned sports club or buy a sports ground at risk of loss from the community. This will help ensure that important parts of the social fabric – like pubs, sports clubs, theatres and post office buildings – can continue to play a central role in towns and villages across the UK.
The Recovery Loan Scheme is to ensure businesses of any size can continue to access loans and other kinds of finance up to £10 million per business once the existing COVID-19 loan schemes close, providing support as businesses recover and grow following the disruption of the pandemic and the end of the transition period.
Once received, the finance can be used for any legitimate business purpose, including growth and investment.
The government guarantees 80% of the finance to the lender to ensure they continue to have the confidence to lend to businesses.
The scheme launches on 6 April and is open until 31 December, subject to review. Loans will be available through a network of accredited lenders, whose names will be made public in due course.
The Chancellor also announced an investment of £25 million in UK grassroots community sports facilities, supporting the future of grassroots football – no details yet on whether this is just for football, and how it will be distributed.
Arts and culture funding
Oliver Dowden, the secretary of state for the Department of Digital, Culture, Media and Sport has confirmed the Culture Recovery Fund (CRF), which has provided grants to events operators and venues, will be increased by £300m from £1.57bn to £1.87bn in the Budget. There will also be a further £90m from the Chancellor to support museums and cultural bodies and nearly £20m for culture projects in regional towns and cities.
Support for people
Universal Credit uplift extension
After warnings from numerous charities about rising poverty, the temporary £20 per week uplift in universal credit benefits has been given a six-month extension. It had been due to be cut at the end of this month. Around 6 million people receive the uplift.
Charities continue to warn that this additional support, while welcome, is not sufficient for many people. Critics have said this pushes the cliff edge to autumn 2021, when unemployment is expecting top be rising.
Working Tax Credit one-off payment
People in receipt of Working Tax Credit will receive a one-off payment of £500 in April 2021.
This will support people and families on legacy benefits, bringing additional payments for those on WTC into line with those on Universal Credit.
National Living Wage
The National Living Wage will increase to £8.91/hour from April 2021, for workers aged 23 and over.
The Government has also published its remit for the Low Pay Commission (LPC) for 2021. The remit asks the LPC to make UK-wide recommendations with the aim of reaching the government’s target for a National Living Wage of two thirds of median earnings, extended to those aged 21 and over, by 2024, provided economic conditions allow.
Personal tax allowances
The personal basic rate tax free allowance goes to £12,570 from April 2021. The higher rate level goes to £50,270.
Allowances will then be frozen for three years.