Almost three-quarters of a million businesses in the UK are “at risk of failure over the next three months” because of the fallout from the Covid-19 pandemic, economists have warned.
The figure has prompted Labour calls for the chancellor, Rishi Sunak, to ease the pressure by allowing bosses to convert government loans to a “student-style” arrangement that would give them more time to repay.
Firms are being dragged down by more than £75bn of Covid debt from the government’s bounce-back loan scheme and similar initiatives, Labour said.
But the Treasury watchdog has estimated that £27.2bn of these liabilities will never be repaid – inflicting a huge cost on the taxpayer, on top of the loss of jobs and livelihoods.