26 March 2020
The Government has committed an additional £100 million of funding over the next three months to keep Islanders in work as the Coronavirus disrupts our economy and way of life.
The new Government initiative will co-fund 80% of the wages of Jersey employees across a wide range of sectors, up to a maximum payment of £1,600 a month, under a revised Payroll Co-funding Scheme. The scheme is confirmed for April to June 2020. It will then be subject to review and can be continued if the situation persists.
This funding is on top of the £180 million of business support already announced in the past two weeks to support the Jersey Business Disruption Loan Scheme, the Jersey Special Situations Fund and through the deferral of GST and Social Security payments.
Ministers also set out new provisions to support workers with less than five years’ residency, who may lose their jobs and do not qualify for Income Support.
In addition, the Government is releasing funds worth more than £3.5 million from the Channel Island Lottery Fund and the Jersey Reclaim Fund, to support charities which are working to protect Islanders at risk.
The Assistant Minister for Treasury and Resources, Senator Ian Gorst, said: “The Fiscal Policy Panel has recommended that the Government draws from the Strategic Reserve and switches our Budgets from running surpluses to running deficits to support jobs, businesses and the economy.
“The details of the Payroll Co-funding Scheme announced today will mean that, from 1 April 2020, the Government will fund 80% of an employee’s monthly wage, up to a cap of £2,000 per month, per employee. This means a maximum Government contribution of £1,600 per month, per employee for around half of the Island’s workforce.
“The scheme incorporates a wide range of sectors that will be significantly impacted by Coronavirus and is designed to allow employers to keep their employees in work. By doing so, we protect their livelihoods and their families and minimise the long-term economic consequences of the pandemic.”
The Minister for Economic Development, Senator Lyndon Farnham, said: “The Government has been clear from the outset of this crisis that we are united in our commitment to supporting businesses, employers and employees. We aim to provide necessary job security in the face of the challenges caused by the coronavirus pandemic.
“In further developing this payroll co-funding scheme, we have also balanced our responsibilities for the prudent long-term management of our public finances, which will be impacted by the economic effects of COVID-19. We believe it is the right approach for the Island.
The Minister for Social Security, Deputy Judy Martin, said: “We need to ensure that we protect all Islanders, including those who may have lived here for less than five years and are therefore not entitled to income and housing benefits. Sadly, many of those people are trapped here, as their home countries borders are closed. The measures we have announced today will help them to put food on the table at this difficult time.
“We are also offering to help those who wish to return home to their families, with a repatriation package that will enable them to leave Jersey when they are able to do so.”
Following the initial announcement of the Coronavirus Payroll Co-Funding Scheme on 20 March, officers from the Government have been in detailed discussions with members of the Island’s business community to develop the operational details of that scheme.
The Government is now in a position to bring forward detailed proposals, which aim to provide businesses and employees with confidence through the introduction of £100 million of funding for three months, from April to June 2020, supporting 27,000 employees.
As announced on 20 March, Phase 1 of the scheme (20 to 31 March 2020) will cover specific sectors and pay up to £200 per employee per week for this period.
From 1 April to 30 June 2020, Phase 2 of the scheme will see it significantly expanded to apply across a larger number of sectors, to ensure that businesses have confidence to plan for the future and employees can be secure in their jobs.
Only a limited number of sectors, that are not likely to be significantly affected by COVID-19 in the short term, are excluded from Phase 2. The scheme will be reviewed after the first three months of operation.
The Jersey co-funding scheme is distinct from its UK equivalent, as it allow employers to keep their staff in work. This will give them the flexibility to use employees for different tasks, or alternatively share staff with other businesses who will still need to operate, sometimes with increased demand, during the life of the pandemic. Staff will also be available to help with government and community initiatives
The scheme will operate by providing a subsidy to employers, allowing them to continue employing and paying staff in their normal way. Applications for payments under the initial scheme can be made through Customer and Local Services at the beginning of April.
The Coronavirus Payroll Co-Funding Scheme will be open to businesses of all sizes - large, medium, small, and microbusinesses, as well as sole traders – and is designed to cover all sectors which may be disrupted due to the health advice issued as a result of COVID-19.
Support for workers with less than five years’ residency
Announced 26 March 2020
The Social Security Minister is announcing financial support for those with under five years’ residency in Jersey. There will be two schemes: one for those who have been here between six months and five years, and one for those who have been here for less than six months.
For those who have recently arrived (less than six months ago) and who have lost their job, employers/landlords will be expected to allow them to remain in their staff accommodation/lodging houses. We will also pay £70 per week as a financial support payment. Further assistance will be available for those who have children. We will also support people to return home to be with their families when this is possible.
Those who have been on Island for longer than six months, have lost their jobs, and have paid contributions and ITIS, will be able to receive financial support as follows:
• £150 per week for an adult living alone and who has lost their job due to Coronavirus
• £100 per week for an adult living with someone else who is working and who has lost their job due to Coronavirus
• £250 per week for two adults living together who have both lost their jobs due to Coronavirus
• £50 per week for each child in the household.
While receiving this support, individuals will be required to support Government and community projects as needed.
Protection for property owners and tenants
The Government has taken action to protect the rights of owners of properties with mortgages, by ensuring that banks and mortgage lenders have measures in place to provide support where customers are experiencing financial difficulties as a result of COVID-19.
The Government is also passing legislation to ensure that residential tenants cannot be evicted from their properties due to the failure to pay rent due or any utilities, service charges or fees paid directly to the landlord for the duration of COVID-19.
For commercial leases, the Government has taken action to ensure that at the current point in time the Courts will not hear applications to terminate or cancel leases and is considering specific further legislation to protect against this situation. This is being considered along with the need for the development of a rent-deferral scheme for both individuals and businesses. The Government is committed to ensuring no individual or business ends up out on the street unreasonably during this crisis.
Assistance for Charities through emergency funding
Announced 26 March 2020
These funds will be given out by an independent organisation and we are still working on how that should operate in practice, the details of which will be brought forward very soon. Payment will be made in blocks of £250,000. This arrangement will remain in place until either the coronavirus crisis is over or new arrangements are put in place.
Jersey Business Disruption Loan Guarantee Scheme
Announced on 18 March
This scheme will facilitate Government guaranteed bank lending and overdrafts is in advanced state and targeted for launch on or around Monday, 30 March. This will create £50 million of new lending capacity to affected businesses and will be accessible through Jersey Business.
Jersey Special Situations Fund
Announced on 18 March
The fund is designed to enable strategic support for larger businesses that deliver public goods or serve a strategic purpose or are important to the recovery of the island post COVID-19
Applications will be made to the Government on a case by case basis and should be for grants, loans or equity interests over £1 million. In special situations the fund will consider applications over £500,000.
Deferring the payment of social security contributions and deferral of GST payments
Announced on 12 March
With immediate effect, businesses with fewer than 80 employees and self-employed individuals can choose to defer their Social Security contribution payments for A and B quarters (payments due in April and July). Larger businesses can apply for a deferral.
In addition, GST-registered businesses can choose to defer the payment of GST relating to quarterly and monthly returns ending 31 March, 30 April, 31 May and 30 June.
Both these schemes may be subject to extension.
Rent deferrals or renegotiations, where the Government, or a Government-owned company, is a landlord to a local business
Announced on 12 March
The Government will be sympathetic to its business tenants who are suffering financial difficulty as a result of the COVID-19 pandemic. Each request for rent deferral will be treated on a case-by-case basis.