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Extending the Furlough Scheme will not save jobs that have already gone. Improving it might at least save some of the small businesses that otherwise won’t survive

August 5, 2020 Leave a comment

The Lockdown was a universal response to a focused issue that created universal problems that were addressed with focused solutions.Whilst many are unwittingly still in denial of what’s really going on around us, an economic tragedy is now beginning to unfold that is likely to touch all of us before its horrid effects are done.

More sensible MPs have only very recently recognised how catastrophically wrong the Government got their response to the Coronavirus Pandemic and Covid-19.

Some of us were well aware of what the consequences would be of opening the Pandora’s Box labelled ‘Lockdown’ and failing to mitigate its impacts universally before it was implemented. We were not alone for very long and groups like #ForgottenLtd followed once the inadequacy of Rishi Sunak’s Public Money giveaway began to hit the Directors of our powerhouse small businesses who had watched their incomes evaporated the moment that everything was stopped.

The Lockdown itself was completely unnecessary. At the start of the Pandemic in the UK as now, the Government could and should have been directly controlling any genuine upsurge in illness on our behalf with the public money and resources available rather than using public money and resources to attempt to control us all with the aim that we would do their job and manage the crisis for them. They chose the alternative that made it easy for them by making it a problem for everyone.

The Lockdown was a universal response to a focused issue that created universal problems that were addressed with focused solutions.

Once they chose to implement the Lockdown and stop the normal flow of work and business, the Government should have stopped the normal flow of money too. Loan repayments, mortgages, leases, interest and payments for or against anything that anyone or any business wouldn’t order or commit to having without any income should have been put on hold until the Lockdown was seen though.

What the Government did instead was attempt to override the universal laws of cause and effect and burn public money to create a false floor by underwriting jobs that vaporised within days once the wheels of industry and commerce were stopped from turning.

Now we have reached August and the requirement has come for businesses to begin contributing to furlough payments too, you can see what businesses are doing. It’s a case of ‘back to work’ or redundancy for all and not just the few that it would have been if the Government had handled this whole crisis as it should.

Furlough money to keep jobs open that no longer exist is in fact a basic income and it would be a very generous one bearing in mind that in terms of an investment for the future, these are payments that will never give anything back,

The time when there should have been a basic income – and a universal basic income too – would have been if the Government had Locked-down the Economy as it did with jobs and businesses too. Payments would have been necessary to EVERYONE who lost their income as a result of the Lockdown, but because they had no bills to pay, it wouldn’t have mattered whether they were a gig-economy worker, a company director or a PLC CEO because their needs would have been exactly the same and would have been universally low-cost too.

Sadly and very regrettably, the time has now long since passed when Boris and Rishi Sunak could have taken this Country along a very different path that would have addressed the Coronavirus question whilst insulating people and businesses against any economic worries too. They blew it.

What is in none of our interests now is for the charade to continue in any way or at any level.

We need to face up the reality of what the Johnson Government has actually done and take the steps and implement the actions that will see us ALL through the massive economic depression that is now dawning.

The people who have lost their jobs need financial help and other forms of support. But we will be helping nobody other than Boris and his Government if we continue to apply this help whilst pretending its purpose is to prop up jobs.

What we do need immediately is further provision targeted at those who have so far not bee helped but still have something to offer the economy post-Lockdown like the Directors of small Limited Companies and those left behind who are ‘Self-Employed’.

Above all however, we need to stop pretending that the Government and the MPs that we have are suitable candidates to get this Country out of the mess that they have created, and that we need new leadership in London to turn things around and take the UK in a very different way.

The reset that is coming is no longer a choice. But the options that will be available within it must be taken for the benefit of us all. That’s when we will have a fair society and people will treat everyone else equally and we will all have what we need and feel happy and content rather than life only appearing to be great for very few.

 

 

 

Boris condemned business with the lockdown, now he’s going to crucify them with a clawback too

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The ignorance, lack of foresight and fear that drove the Johnson Government to implement the Lockdown was only surpassed by the stupidity that underpinned the financial measures that the Chancellor implemented, leaving holes for many to fall through and creating anomalies at every turn.

The owners and managers of businesses knew exactly what the implications of the Lockdown were going to be as soon as it was called.

Business people didn’t need advisors, astronomy or the gift of second sight. They had the experience of running businesses to understand what damage would be caused to an economy when everything is simply shut down.

Sadly, the politicians did not.

After months of stories that any half-decent representative of the people would be paying attention to, the Government should have known only too well that their clever giveaway devices like the Job Retention Scheme were only going to retain jobs for as long as they continued.

Instead, the Government is now planning to claw back money from employers who paid staff using these schemes, if they will not continue to pay employees for jobs that no longer exist.

It should be of critical concern to us all that the people who run this country really thought that after imposing the Lockdown, handouts and loans were all that it would take to stop the UK economy from going bang.

Unfortunately, because of the way that media-led group thinking now works, instead of looking at the reality that we need immediate change, we will instead be drawn to look at the apparently unscrupulous behaviour of company owners and big businesses who have paid out public money to pay for non existent jobs instead of making everyone immediately redundant – as they would have done in March, if Boris and Sunak’s great ‘free money handout’ hadn’t begun

By creating an after-the-fact clawback as it is understood to be the case that the Chancellor now is, the Government will effectively crucify many of the remaining businesses left of those that the Lockdown had already condemned.

It used to be only a Labour and union-driven fallacy that businesses only exist to provide jobs. But by adopting the so-called economic thinking that this Conservative Government already has and now seems set on continuing to do so, it has become clear that none of our politicians are equipped with the basic understanding of what drives enterprise and what it takes to makes business work.

Businesses pay people to do and make the things that earn them money and it is only when those services and products are being paid for by customers that there is any need to employ people who take a cut of it in what they earn.

The Johnson Government has created the economic crisis that is now unfolding and instead of trying to turn things around, seize the opportunities that the crisis has created to effect positive change and make the best of a difficult situation as they should, they are instead digging in, looking to consolidate and setting themselves up to make things even worse for us all.

Boris and his Government have not been short of lessons after all they have done. They just keep refusing to learn.

 

 

Do businesses make staff redundant now or delay using furlough money until October?

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The Financial Measures that the Government implemented as a follow up to the Lockdown are a piecemeal response to a universal problem.

Even now, organisations such as Forgotten Ltd are fighting to highlight for a response from the Treasury over the lack of provision for Directors of Ltd Companies forced to stop or severely reduce trading, losing their incomes as a result.

They are not alone. There are many people already suffering in silence from the impact of the Lockdown.

As the so-called help from the Government is reduced and then stopped, there are going to be many more.

Of the businesses able to apply for ‘furlough money’ under the Job Retention Scheme, many jumped in as quickly as they could, knowing only too well that if their turnover ceased or was severely reduced, it would be the jobs of employees that would be out of the door first.

In principle, the Scheme well for companies employing significant numbers of staff who are paid around the average wage. Or at least that’s how it seemed before the realities of what the Government has created with the Lockdown began to actually sink in.

What is not being reported in the media yet, is that all sorts of unforeseen consequences are beginning to unfold for business.

One business I am aware of that employs around 750 people has began to end furlough, re-starting around 200 of their most qualified and experienced staff. They have already concluded they are achieving 40-50% of normal productivity and turnover with just 25% of the workforce and they are now re-evaluating their business model, even before the coming recession begins to kick-in.

However, the wider marketplace has changed overnight. Jobs that were needed and even considered critical until March no longer exist on the whiteboards in the boardrooms. But because the Government is paying the wages – or the biggest part of them, they will technically exist until October. That is unless Business Owners, Directors and Managers turn away the ‘free money’ that the Government is providing for those staff until and bring forward mass redundancies now.

At first glance, it is easy to conclude that if a job no longer exists and the Company knows this, they should make those staff redundant now and stop claiming the money from the Government.

But life is seldom as straightforward as it looks at first glance. We must be careful over how and where the answer to what is fundamentally a question of morality, wholly dependent and conditional upon where our own perspective lies.

With the Spectator Magazine, the dilemma that is at work was put into full force yesterday when Chairman Andrew Neil announced that they had done much better through the Lockdown than expected and had decided to give all their Government Furlough Money back.

Kudos to the Spectator as far as the fortune of their current position goes. But an elaborate form of virtue signalling like this – no matter how genuine the reasoning might have been, in itself helps no-one. Simply, because for too many other businesses, the decision they make over the money they claim and pass on to people who are currently on their books have real-life outcomes involved.

Yes, it is Public money that the Government is handing out. But the Government created the Lockdown in the first place.

No, an employer shouldn’t claim money from the Government that it doesn’t have to spend. But they are doing nothing legally wrong and after October, the many thousands if not millions of people living on furlough money today, may find themselves beginning many years without jobs.

What is very clear is the Government has entered a minefield of its own making where it could and should have made the effort to really think these things through.

A universal problem requires a universal solution.

We should have been given a a simple one, rather than the complicated one that we have got.

Nobody should be falling through the gaps in provision. Nobody should be made to feel wrong or guilty for taking any or all of the help that has been offered when they didn’t choose to stop trading.

Taking whatever is on offer is all that they – and many of their employees – have still got.

 

The Government has Bankrupted Britain whilst jumping into a trap that it will not climb out of if it continues to behave the same way

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Somewhere in London, a new kind of reality has dawned. We may note ever hear it spoken about or acted upon in any way or sense. But rest assured, a new era has now been born.

Six weeks ago, the Johnson Government took a series of decisions that are about to have seismic consequences for us all.

It began with the Lockdown. It was aided by the clever and manipulative messaging that was purposefully designed to make normal people too frightened to go out. It then culminated with a series of financial ‘support’ measures such as the so-called ‘Job Retention Scheme’ that has failed businesses, workers and the Country at large whilst addicting many to ‘free wages’ and polarising them against returning to work.

The Bank of England has today announced that the UK is officially now in recession, and this my friends is just the start.

The Lockdown itself was unnecessary. It traded all the certainties and regularities of life that we had like going to work, the pub, the gym, the shops, catching a bus or train or visiting whoever we might like to as and when we wanted to, for a gamble on what stronger leadership would have known would be a futile attempt to control a virus which they could only ever manage – not control.

The use of Behavioural Insights and mass manipulation, aided by an out of control media to install fear, purely on the basis of getting people to accept and adhere to the Lockdown and the Social Distancing measures that the Government imposed was a textbook example of both what to do and not to do all wrapped up in one.

Use of terms like ‘Stay at home, save lives’, ‘Protect the NHS’, and go outside on Thursday night at 8 and clap for the Keyworkers succeeded in securing such rigorous levels of buy-in to the Lockdown, Social Distancing and the measures taken, that many people genuinely and sincerely believe that acceptance of any and all measures that the Government dictates will be the only way that they can remain alive.

Many will not willingly respond to directives that go the other way, simply because the subject matter of the manipulation used has touched on the promotion of measures to avoid death.

Death and its avoidance is the primary fear that drives many parts of life and sits within the subconsciouses of us all. It influences so much in life, but rarely finds its way coming into our rational view.

The financial package that the Chancellor followed up the release of the genie with was much too clever for its own good. It over complicated matters when there was always a simple, fairer and much less damaging way to mitigate the fallout from the lockdown whilst addressing the issue of income for us all.

It is unlikely that senior members of a national government running the UK Treasury would not have known about or discussed the alternative options that were at hand. So we must conclude that the absence of real leadership at the top meant that the Government yet again went for what seemed to be the easy option rather than the right one, and in so doing laid out a giant trap for itself into which the Country is now about to fall.

In the coming days it is likely that the ties of the Lockdown will be loosened. But with the same ideas and mentality driving the direction now as we have experienced since the COVID-19 emergency began, it is likely that in only a couple or a few weeks from now, the Government will have to return us all to the full Lockdown again of not something even more punitive, because these so-called leaders have still not faced up to their responsibilities or the most salient facts.

That is of course if the majority of people still agree.

You cannot inflict absolutes on a population to resolve an emergency when no absolutes about the emergency like when it will end and how it will be ended are known.

It takes real leadership to go against the media and say that it is unavoidable that people will die, but we also have to maintain a level of life and functionality across everything that lies beyond the emergency so that we can make it possible for everyone else to live.

But that is exactly what we needed from Boris Johnson and Rishi Sunak at the beginning of the Pandemic, and even now, which such an incredibly damaging chain reaction for the economy now started and underway, it is the same thing that we need to hear them say.

COVID-19 is not going anywhere anytime soon and we cannot restrict every other part of life with Lockdowns and Social Distancing measures that are completely impractical until it has, just so the fearful believe that we have it all under control.

We don’t. We wont. And what the Government has been doing has been giving people they have deliberately worked up into a frenzy of fear false hope and a false sense of security. People genuinely believe that they will avoid death by following these measures without realising that they no longer have lives to live.

The Government needs to manage Coronavirus as the firestorm that it is. That means firefighting wherever the fire breaks out by focusing all the resources where necessary and not spreading them out so thinly that we will continually be overpowered by a Virus that they still don’t understand.

Only when the Government does this will they begin to be able to start addressing what is going to become the far more pressing crisis at hand: How do you manage an economic crisis when you cannot keep printing money and printing money is the only thing they can think of that will work.

 

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