The clock is running down for millions of people on the job furlough scheme as businesses face “going to the wall”, Labour has said.
Shadow chancellor Anneliese Dodds called on the Government to act urgently to rebuild business in the wake of the coronavirus crisis.
With the work furlough scheme set to finish at the end of October, Ms Dodds used a keynote speech to Labour’s online conference to attack the stance of Chancellor Rishi Sunak.
Ms Dodds said: “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.
“That is why I am calling today for the Chancellor to act urgently and put in place a business rebuilding programme.
“To do for businesses struggling with debt what we have repeatedly asked him to do for workers whose jobs are at risk. That programme must be set up now.
“So we don’t end up once again with last-minute panicked schemes that waste public money.
“It must be targeted so that support goes to purposeful, responsible businesses that will invest for the future.”
Ms Dodds held out the prospect of a new partnership between business and a Labour government, insisting the party can be trusted with the nation’s finances.
She launched an attack on the Government’s “financial mismanagement” during the Covid-19 crisis, accusing the Tories of squandering billions of pounds of public money.
Ms Dodds said that a Labour government would seek to restore trust with business, emphasising the “critical role” it played in creating jobs and supporting livelihoods.
“Government working hand in hand with business and trade unions, in the best interests of our country,” she said.
“This is an ambitious Labour vision – where security and fairness aren’t just aspirations, but where they are a reality for families and communities across our country.
“As chancellor, I would restore that trust with business because I understand what a critical role business plays in creating jobs and supporting livelihoods across the country.”
Ms Dodds said that a three-step economic plan would be built around the principles of “recover jobs, retrain workers and rebuild business”.
She said a Labour government would continue to help subsidise the wages of workers in key sectors in a way which would enable firms to bring back more staff on reduced hours.
In addition, there would be a national retraining strategy for those workers who had lost their jobs and a business rebuilding programme to support struggling but viable firms.
Ms Dodds also attacked Mr Sunak for his “cavalier” approach to public money, handing over large sums to support businesses with “no strings attached”.
Chairman of the Federation of Small Businesses (FSB) Mike Cherry was supportive of the proposals put forward by Ms Dodds.
He said: “We very much welcome the shadow chancellor’s discussion of proposals for a business rebuilding programme.
“Firms will undoubtedly struggle with debt over the coming months and we need meaningful Government action to help viable firms with that burden.”