The British government on Monday announced a £ 1.25 billion aid plan for innovative start-ups struggling to find funding amid the pandemic. Finance Minister Rishi Sunak explained in a press release that this money would be used to protect fast-growing startups, in technology or health for example. In detail, this plan, financed by public and private money, includes a loan mechanism of 500 million pounds, as well as assistance of 750 million pounds for research and development for SMEs.
The loan system, to which the government will contribute up to 250 million pounds, will be open to companies that have already raised funds in recent years. And if the money is not repaid, the loan will be converted into equity participation. The United Kingdom ” is a world leader in innovation ” and ” our startups are one of our great strengths that will support growth ” after the pandemic, said Rishi Sunak.
80% of salaries are covered
The government is trying by all means to keep the British economy afloat, threatened with a historic recession due to the pandemic. He has already promised to guarantee up to 330 billion pounds of business loans and will cover 80% of wages so that companies favor short-time working and do not lay off. Employers will also be able from Monday morning to submit their file to request this payment of wages.
Some 5,000 officials will be mobilized to examine the requests, according to the Treasury, which extended by one month until the end of June this aid mechanism, which has applied since March. The government has, however, been under pressure for a few days from employers’ organizations and the Labor Party to cover 100% of the salary, the only way they believe to push the banks to help as many businesses as possible and avoid bankruptcy.