BUSINESS leaders in Cumbria have welcomed the Government's new plan to protect jobs, although acknowledging the challenges ahead.

The Chancellor of the Exchequer outlined the Government's Jobs Support Scheme during a speech in the House of Commons yesterday.

He also announced a Pay as You Grow scheme, designed to give more time to businesses to repay loans and VAT bills.

VAT reductions from 20 to five per cent were also extended for hospitality and tourism sector until March 31.

Rob Johnston, chief executive at Cumbria Chamber of Commerce said he welcomed the announcement, as businesses were looking to shed workers once the furlough scheme came to an end.

Gill Haigh, managing director of Cumbria Tourism, said she was pleased to see the Chancellor acknowledging the challenges of the tourism sector.

Mr Johnston said: "We were very worried about the end of the furlough scheme. South Lakeland and Eden had the highest proportion of furloughed workers in the country so Cumbria is really exposed.

“A British Chambers’ survey revealed that a third of businesses were planning to shed workers when the scheme ends. Cumbria’s already seen unemployment double since lockdown and it would certainly have gone a lot higher.

“The new scheme isn’t as generous but it’s a lot better than doing nothing and it will reduce job losses. It won’t save businesses beyond the point of no return but it will help those that have a future to make a go of it.

“There are a lot of self-employed businesspeople in Cumbria so we’re pleased that he’s extended the Self-Employment Income Support Scheme.

“Overall, we’re relieved that he’s acted and welcome what he’s done. It works particularly well for Cumbria. However, he will need to do more if the Government tightens lockdown restrictions further.”

Ms Haigh said initial feedback suggested the measures would benefit businesses in terms of cashflow.

"The devil is in the detail, but we are pleased that the statement acknowledges the very specific challenges for the tourism sector, given that businesses were unable to open for almost four months in the usually buoyant summer season and are now facing the longer-term impact of a £1.5billion loss to Cumbria’s tourism industry amid continuing restrictions and uncertainty.

“Initial responses from our member businesses suggest the new measures should have a positive effect on cashflow for many tourism operators. The continued reduction in VAT will be particularly welcomed, there is good news for those who have taken out Coronavirus Business Interruption Loans and it’s great to see employers being actively supported to bring people back to work. We are certainly looking forward to hearing more detail about today’s announcement, particularly around the new successor loan scheme planned for January.

“At the same time, we need to recognise that there are concerns it may be too late for some businesses, and some will continue to find it difficult to access the new measures. There is also a question mark over what happens if there is another national lockdown and this is something we will be monitoring closely.

“Cumbria Tourism’s research team will be continuing its in-depth business tracker research over the coming months to ensure we have strong, up-to-date information about the impact of the new measures. We can then use this evidence to directly inform national decision-makers and make the strongest possible case for Cumbria if additional targeted support is needed further down the line.”