General

The Northern Ireland Executive have set out their plans to deal with Covid-19 over the coming winter in a bid to contain the infection rate of the virus, but at the same time keeping the economy ticking over as smoothly as possible. The plans include using Covid status certifications in high risk settings if required and the retention of face coverings to be worn in public indoor settings.

A Need To Stay Vigilant

The Executive have reiterated the need to be vigilant over the winter so that hospitalisations as a result of coronavirus remain low. The threat of the virus has not gone away so it is vital that measures are put in place to reduce the infection rate and that businesses and the public adhere to those measures.

Retention Of Face Coverings In Public Indoor Settings

Here are details on the measures as copied from an article on the Belfast Live website:

Measures include:

• `The retention of a legal requirement for face coverings in public indoor settings
• The continued legal requirement for risk assessments to be carried out in certain settings and for visitor and attendee details to be recorded to support the work of the Test, Trace and Protect system

`The statement continued: “In addition we will also retain a focus on flexible and hybrid working to reduce the number of contacts that take place in work settings – recognising that employers are well placed to engage with their workforce on the model that best suits their business.”

`In the event that case numbers rise sharply or hospital pressures become unsustainable, the Autumn/Winter Plan sets out a number of potential contingency measures which the Executive may decide to use:

• `More focused communications to emphasise the risk and the need for everyone to act immediately
• The potential to deploy Covid status certification in higher risk settings if considered appropriate and necessary
• A strengthening of arrangements for self-isolation for close contacts
• A re-imposition of a legal requirement for minimum social distancing in prescribed settings

`Paul Givan and Michelle O’Neill said: “We have all come a long way together over the last 19 months and these worst of times have brought out the best in people. There has been a huge societal effort to slow the spread of the virus and, in following the public health advice, many lives have been saved.

The Threat From The Virus Remains

“We need that effort to continue. The threat from the virus remains and if we are to continue to keep our society as open as possible and retain the progress we have made, then everyone must continue to stick to the public health advice.”

It would be a disaster of epic proportions if we ended up in another hard lockdown, with the NHS under huge pressure as more people became ill with Covid-19, so let us hope that we can avert such a scenario and we can all go about our daily lives.

The Northern Ireland Tourism Alliance (NITA) has urged that the proposed Holiday-At-Home voucher scheme be given more funding. At present there is £2 million set aside to run this scheme, but the NITA believes that a lot of people would miss out on these vouchers and be disappointed if the funding is not increased. With the high street voucher scheme, which is now running, all people in Northern Ireland over the age of 18 are eligible to receive the vouchers, however the Holiday-At-Home scheme is not likely to be so wide reaching.

Details Of The Scheme

The proposed scheme will allow households to claim 50% back off a stay of 2 nights or more in specified accommodation, up to the value of £100. And vouchers will also be issued to give 50% off various attractions and events in Northern Ireland, this up to the value of £20. All households can apply for one of each type of voucher but there could be issues if demand is high.

In an article on the BBC News website NITA chief executive Joanne Stuart is quoted as saying:

“£2m has been allocated to this scheme and we do believe the demand will be high and a lot of people will be disappointed, so we would ask the minister to consider the funding he has and whether there is more available to the scheme,” she said.

“This is not just support for the accommodation sector and tourism attractions. When people stay in a destination, they spend money in hospitality or retail so there would be much more in terms of a wider economic benefit.

“We believe this is a really important intervention for the accommodation and attraction sector and we are working with the department and the minister with regards to when this needs to be launched.

“Given the funding needs to be spent by the end of the financial year we would like to see it launched as soon as possible to see the maximum return on investment,” she said.

The Tourism Industry Is Not Out Of The Woods Yet

She was also asked in the article if she thought the scheme would work well if it was launched in January or February. She said:

“January to March is traditionally the slowest period of the year so if we were able to get a scheme that starts in January, we would get the chance to get the benefit in those slow months,” she said.

“From 1 April, we are going to see significant cost increases with the rates holiday ending and VAT returning to 20%.

“The majority of tourism businesses have had to take loans and in 2022 the repayments are going to be starting, so anything we can do to help those businesses have a better January to March period would be really good before moving into the high season. We are not out of the woods.”

One Of A Number Of Measures Being Looked At

The Department for the Economy, when asked about the scheme, said that it was one of a number of measures that were being looked at, and they were working with people in the industry to decide on the best time to launch it.

The tourism industry is a key part of the Northern Irish economy and so every effort should be made to help and support it through these turbulent times.

Economy minister Gordon Lyons has said that over 160,000 pre-paid cards have been sent out to members of the Northern Ireland community so far, with another 50,000 all ready to be shipped out. The pre-paid cards, as part of the high street voucher scheme, can be used to purchase £100 of products from local businesses. They cannot be used to buy products online, as the scheme is hoping to stimulate trade in the high streets of the country and bring the buzz back that was lost during the long coronavirus crisis.

Applications For The Cards Are Rolling In

Mr Lyons confirmed that over 1.2 million applications for the cards have so far been received and of these approximately 1 million have been processed and verified. The cards are gong out to all members of the community who are 18 years or over but they must apply to receive them from an online portal.

Speaking about the scheme and about the fact that he has received a pre-paid card to spend himself, Gordon Lyons is quoted on the Newsletter website as saying:

“I have no special privileges but I have been able to get my spend local card, it is a little bit smaller than the one that I was going around with earlier in the summer time,” he told MLAs.

“It’s great that we’re going to have these cards delivered right across Northern Ireland to be spent in local independent retailers, and in hospitality, and in entertainment and leisure and other services.”

On the subject of how many applications they have so far verified he said: “I think that’s good news for businesses right across Northern Ireland that suffered so much during the lockdown.”

Faults With A Small Number Have Been Ironed Out

And on the fact that there have been a few faults found in some of the cards he said: “There has been a number of very isolated incidents of people not being able to use their card due to the business, they’re largely larger multi-nationals who are registered in GB and there has been a coding issue with the card, however that has been a very small number and we have found a fix to that,”

This is all good news and all we can really add is let us hope everyone who is eligible takes the trouble to apply for the high street vouchers so that it can give local businesses a real boost in the run up to Christmas. It is also important that businesses take the time to promote the scheme so that they can make the most out of the opportunity.

Latest statistics from the purchasing managers index (PMI), which is produced by Ulster Bank, show that inflationary pressures are ramping up for businesses in Northern Ireland. The September survey showed a return to an alarming trend, after a brief slowdown in inflation in August, with prices moving up at a rate not seen since this particular survey began back in 2002.

Astonishing Rises In Raw Energy Prices

The last few weeks have seen astonishing rises in raw energy prices, for which many businesses are not protected from. Many sectors of industry are reliant on using large amounts of gas to run their business, so energy hikes which have gone up at one point by around 900%, make keeping their company buoyant virtually impossible. A lot of businesses are saying that if some government intervention is not forthcoming, to either put a cap on the energy prices for them or get extra funding, then they will have to cease production whilst prices are so high, or worse still go into liquidation.

The PMI survey showed that selling prices moved up to a record high last month as businesses in the main had no alternative than to pass on some of the increase in costs onto the consumer.

Double Whammy For Businesses

There has been a double whammy for businesses recently with the ongoing supply chain issues hampering them as well as a rise in costs, and this has led to an overall fall in new orders in Northern Ireland. Supplier delivery times are lengthening by the week which is a huge concern for many as we edge ever closer to the Christmas period.

Retail and construction seem to be the sectors which have been hit most by all of the above, but thankfully there is still some optimism around among the business community as we move out of the Covid-19 crisis which has engulfed the world over the last 18 months.

Could Things Look A Lot Rosier In A Few Months Time?

So what we will hopefully see in the not too distant future is energy prices beginning to stabilise, as if this is complemented by the government giving financial help in some form or another to get businesses who need it through this turbulent period, then things may look a lot rosier in a few months time. The supply chain issues are definitely going to be with us for a while yet, but again it shouldn`t be beyond us to see a way through this with a bit of give and take from all sides. Let us sincerely hope so.

Not surprisingly bus and coach companies were sectors that were particularly hard hit by the Covid-19 pandemic. They are also sectors that are struggling to recover, as the tourist industry in Northern Ireland has been very slow to pick up once more. Coach companies rely on tourist trade, taking them to various landmarks and attractions across the country, so without these people, who will not be seen in any volume now until next April at the earliest, their revenue is seriously impacted.

The Industry Has Been Decimated

Here is what Karen Magill, chief executive of Bus and Coach NI, said on this issue, quotes coming from the BBC News website:

“Our industry has been decimated by Covid-19 and at this point in time while other sectors of the economy are recovering, unfortunately we are not.

“We still have 75% of our fleet idle and we wont see any return to business until March or April next year,” she said.

“Despite not being back to full capacity, with little or no income, and restricted demand, we have increased additional costs incurring every day.

“We have significant Coronavirus Business Interruption Loan Scheme (CBILS) loans and those increasing Covid debts and restricted demand mean companies are seriously vulnerable.

“If you have a loan of £1.5m, your monthly repayment now is £16,000, and this is based on actual figures from some companies,” she said.

Asked if she expects all operators to survive the next few months, Ms Magill said: “At this point in time, no I don’t.”

Additional Financial Support Is Vital

Ms Magill went on to say that additional financial support that operators could access quickly is vital at this stage, saying:

“We have had two previous schemes through the Department for Infrastructure… at this stage 50% of businesses out there were not eligible for support. There was a formula which should have made life simple but didn’t.

“We had one operator who received £3,200. Out of that, which is what they were eligible for, they had to pay £1,500 out to their accountant as we had to have all figures backed by an accountancy firm.

“Other operators have benefited from the scheme,”

If you have a business that needs financial help, but you are unsure if there are any grants or funding out there that would be available to you, please contact our offices here at WHR Accountants so that we can help you with this. Call us on 028 3752 2909.

After a welcome holiday on paying stamp duty, introduced when we came out of the first major Covid lockdown last summer, it has now returned to its regular pre-pandemic levels here in Northern Ireland and England. I am sure if you moved house during this stamp duty holiday you were very grateful for this cut, and in fact there were record sales during this period which showed the popularity of this strategy.

Differing Views On Whether It Was A Good Or Bad Move

However there are differing views on whether it has been good for the housing market and the country as a whole. Mark Bogard, chief executive of The Family Building Society, speaking to BBC News, is very positive over the stamp duty cut and believes it should continue. He said:

“Stamp duty is a very significant tax, but it is extremely easy to avoid by just not moving home,

“People have generally been living in the same home for longer than in the past. That is especially true of potential ‘downsizers’, who have been put off moving because they would normally have to pay stamp duty,”

He believes the cut created a real economic stimulus: “People spend significant amounts of money sprucing-up a property before they sell it, money is then spent during the buying and selling process, and then buyers spend again to make changes when they move in,

“I can’t see any argument for not continuing with [the stamp duty holiday],”

No Need To Have Extended The Tax Break After March

However Lindsay Judge, who is research director for the Resolution Foundation, believes that the stamp duty tax break, although welcome at the time, should not have been extended beyond March of this year. In the same article she said:

“The government didn’t turn off the tap when it became apparent that it inflated house prices,

“The reason why it was largely unnecessary was because there have been other stimulus effects in the housing market.”

The article goes on to say:

`She says that many people who continued their jobs unaffected by the pandemic built-up large amounts of savings, which they could then use for house moves.

`The Covid crisis also changed people’s preferences, increasing demand for larger houses with a garden in more leafy areas. As a result, potential buyers brought forward house moves they had planned for the future.

`The extra demand, unmatched by supply, meant house prices rose sharply. She points out that house prices continued to go up in Scotland, even after their tax breaks for residential Land and Buildings Transaction Tax stopped at the end of March.

`This has made the prospect of buying a home even more distant for prospective first-time buyers, she adds.

`By offering all buyers a stamp duty holiday, first-time buyers lost the rare advantage they had previously. Their own stamp duty break pre-pandemic had given them some bargaining power in the market.

`She says that the stamp duty holiday, which the Office for Budget Responsibility calculated would cost the taxpayer £4.7bn in two years, simply made “a hot market even hotter”.

That is it for this blog, if you ever need any help with stamp duty payments, or moving home or business premises, please give our office a ring for up to date advice.