Market News CBM highlights importance of industry stimulus packages
Confederation of British Metalforming (CBM) members have called for industry stimulus packages and a review of the viability tests on Coronavirus Business Interruption Loans (CBILS).
CBM bosses are increasingly concerned with the fact that Covid-19 Business Interruption Loans (CBILS) acceptance rates are still only 50 % of actual applications, with the Government focusing too much on the value loaned as opposed to the poor take-up rate.
This is being attributed to CBILS being hampered by EU state aid rules relating to ‘undertakings in difficulty’ being followed by the letter of the law in the UK, whereas other European countries are being more liberal in their approach.
Steve Morley, President of the Confederation of British Metalforming, commented: “We would really like to see the same flexibility of approach employed by the banks when considering CBILS/CLBILS applications. These loans can make a huge difference to protecting the future of some fantastic businesses and giving them the chance to recover — that lifeline shouldn’t be taken away because of legislation not fit for the current situation and a viability test based on three years of Brexit uncertainty.
“This review, alongside the Trade Credit Insurance changes due to be announced this week, will build on the platform of support given to manufacturers.”
CBM represents over 200 members, providing the largest collective voice for the metalforming sector.
It provides essential lobbying for the sector, training services, access to knowledge sharing events and support with Climate Change Levy administration, the latter delivering more than 4m pound of savings to members every year.
Steve continued: “Going forward, we will be pushing the Government for some form of stimulus to aid all sectors. This will be critical to supporting growth to help markets recover, especially as we are already seeing our European competitors providing assistance to their automotive and aerospace industries…we can’t afford to be left behind.
“With the ongoing trade deal negotiations with the EU in the background, it's clear manufacturing can’t afford a no deal on top of the severe disruption caused by Covid-19… the path needs to be as smooth as possible”
CBM members have given their unanimous approval to the furlough scheme changes and many firms are confident it will allow them to weigh up manpower requirements against a fluctuating order book.
The tapering of the incremental payments through until October was also welcomed and seen by many as giving them additional breathing space to make future decisions on employment levels.
Steve went on to add: “Manufacturers have been given a framework now to map out workforce requirements against a very mixed and fluctuating sales outlook.
“This was desperately required as the additional flexibility — to bring staff back for a number of days and not after three weeks - will mean they can attempt to scale up and start the economic recovery with more confidence.
“The ongoing support will underpin financial planning at least until the end of October, but whilst this is one piece of positive news, other actions are required to support business and aid its recovery.
He concluded: “It's inevitable that, despite the much welcomed government intervention on the furlough scheme, redundancies will still happen. What we have to do now is work together to ensure every effort is made to keep them to a minimum.”