Mental well-being of entrepreneurs vital for UK economic recovery
A lack of Covid support measures for entrepreneurs is causing mental stress and the Government should step in and provide a support system, say tax and advisory firm Blick Rothenberg. Richard Churchill a business partner at the firm spoke to Business Leader about the importance of Mental Health Week.
This week is mental well-being week and whilst there has been well publicised support for private individuals, particularly those with excessive debt caused by COVID, there has been no support for the bedrock of the UK economy – Entrepreneurs.
The UK government should acknowledge the stress being caused and provide a support system aimed at supporting entrepreneurs through this time.
Additionally, it could seek to reduce some of the burdens on cash flow by providing greater flexibility on the repayment of CBIL debt, by extending the period of repayment to 10 years and allowing a further 6-month deferral of repayments.
For those businesses with excessive debt, this needs to be restructured and some converted to equity. A government lead investment fund should be created to allow government and private individuals the opportunity to take a stake in these businesses, reducing the debt burden but allowing the owners, government and private individuals the opportunity to share in future growth of the business.
Often business owners are there to support the people within their business and provide the strategic direction for the business. However poor mental well-being can impact these decisions, resulting in poor financial performance for the business which then has a negative impact on employment and the wider UK economy. One of the largest contributing factors to poor mental well-being is the stress caused by excessive debt.
Many businesses that took up the Government’s COVID support measures, are entering the period during which repayments of borrowed money through the CBIL scheme or deferred VAT needs to be repaid, just when the UK economy is opening up and COVID restrictions are being gradually lifted.
Effected businesses have not had the opportunity to trade and replenish cash reserves before these repayments are due. This is causing great stress to many business owners who simply don’t know if they can survive, or face the prospect of working to simply pay the debt back with no ability to invest and grow their business.