Insolvency rule changes enable business to recover

Business Secretary Alok Sharma says the government told workers and business leaders that he “appreciates just how tough the situation is”.

Sharma told them: “You are delivering for our nation through this difficult time.”

He also announced that there will change elements of the insolvency system to help UK companies keep trading.

He said that legislation will be introduced soon to allow UK companies to “weather the storm” of the virus.

There will be a temporary suspension of “wrongful trading” rules which make it a criminal offence for a company director to keep on trading if they know the business is unable to repay its debts.

Companies required to hold annual general meetings will also get help – either being able to postpone or hold the AGM online.

Sharma also said that workers can now defer their annual leave for another two years.

“This will protect staff from losing out, while providing businesses with flexibility when they need it most.”

He added that banks are processing thousands of applications for loans designed to help businesses with an annual turnover below £45m.

And he stated that  local authorities are beginning to receive funds in order to distribute as grants to small and medium businesses.

There will also be a reduction in red tape around the production of hand sanitiser which they hope will result in hand sanitiser and PPE (Personal Protection Equipment) to the market quickly.

He added that suppliers will be able to bring the product to market in a matter of days.