Shadow Chancellor Anneliese Dodds has called for urgent action from the UK Government as businesses face “going to the wall” if support is withdrawn.
The Aberdeen-born politician said the country is in the midst of a “jobs crisis”, as she outlined her plan to rebuild business in the wake of the coronavirus crisis.
In a key note speech on Monday to Labour Connected – a four-day online event in place of the party’s annual conference – Ms Dodds said “cliff edges” are looming.
She added: “Just as the Chancellor has allowed the clock to run down on the four million people on furlough, he’s doing exactly the same for the millions of businesses that have needed a helping hand to survive these last few months.
“From March next year, repayments will start for the loan schemes set up to help businesses through the crisis. But on the current trend, our economy won’t be anything like back to normal by then.
“Without effective government action, many companies will go to the wall, with more job losses and more costs for the public finances.”
The Shadow Chancellor called for a system of targeted wage support that would protect jobs “essential” for the country’s recovery.
Ms Dodds said the Jobs Recovery Scheme would allow businesses in “key sectors” to bring staff back to work on reduced hours, with the government backing wages for the rest of the week.
“The scheme would incentivise targeted businesses to bring back more workers part-time, instead of bringing some back full-time, and letting others go,” she added.
Training must be a “core part” of such a scheme, with the Labour politician calling on the Conservatives to bring forward the £3 billion earmarked for a National Skills Fund.
Without effective government action, many companies will go to the wall, with more job losses and more costs for the public finances.”
Shadow chancellor Anneliese Dodds
Ms Dodds also referenced her late father Keith in Monday’s keynote speech, stating he was an accountant who treated his staff “more like friends than employees”.
The Labour politician’s father ran a small accountancy firm, initially in Stonehaven but later in Montrose, that Ms Dodds has previously said inspired her approach to business.
She said: “I know how awful he would feel if he were in the shoes of so many business owners right now.”
The shadow chancellor called on Chancellor Rishi Sunak to “act urgently” and put in place a Business Rebuilding Programme, which would be targeted to “purposeful, responsible businesses that will invest for the future”, including around net zero targets.
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Ms Dodds used her speech to attack the government’s “financial mismanagement” during the Covid-19 crisis, accusing the Conservatives of having wasted “enormous amounts of public money”.
She said: “As Chancellor, I would ensure that public money was always spent wisely. Targeted where it’s needed most. Not splurged where it isn’t.”
Chairman of the Federation of Small Businesses (FSB) Mike Cherry welcomed the proposals put forward by the shadow chancellor.
He said: “Firms will undoubtedly struggle with debt over the coming months and we need meaningful government action to help viable firms with that burden.”