Regional confederation: Include business chambers in covid19 relief conversation

Of the 27,000 registered businesses in TT, about 16,000 belong to the small and medium enterprise (SME) sector. But this sector, as described by Jai Leladarsingh, co-ordinator of the Confederation of Regional Business Chambers, is on life support because of measures to combat covid19.

While government has put in place a suite of relief measures, which includes loans for businesses and unemployment relief grants for those experiencing a loss of income or a reduction of income, Leladarsingh says the measures were not well thought out. He said relief needs to be tailored to the needs of businesses and designed to be accessible to all businesses, especially at a time when they need it the most.

The confederation called for a seat at the table when discussing relief for small and micro enterprises, saying it had its finger on the pulse of the second largest market in TT’s economy and knows what businesses really need.

Red tape keeps businesses in the red

First of all, there is too much bureaucracy, Leladarsingh said. He called for leniency in the loan process.

To apply for the loan facilitated through government bodies, small businesses need to meet a list of requirements including supplying audited financial records for three years and certificates of compliance with National Insurance and the Board of Inland Revenue.

He said while there should be a high level of compliance, especially where National Insurance and the Board of Inland Revenue are concerned, in reality there isn’t.

“Not because some businesses want to rob people, but because they are lackadaisical. But that doesn’t mean you punish them; that means you help them.”

He suggested that through the chambers and government bodies an assistance unit should be formed so that unregistered businesses could be guided through the process.

Eastern Business and Merchant’s Association president Ricardo Mohammed added that many businesses had their paperwork in order, but partly because of bureaucracy, they still did not get the relief they deserved.

“I can safely tell you EBMA have registered businesses and are paying taxes and NIS. None of us got anything.”

“Even though at the initial phases businesses were asked to close early, and we applied for salary relief grants for affected workers, although we were paying NIS, we weren’t seeing any relief.”

As for staff he said eventually reports came in of people getting relief – but not everyone, despite their signing off on NIS and BIR forms.

He said businesses in his chamber not only complied with the measures and followed the requirements for relief, but also assisted the public by sharing food. Businesses also incurred the extra overhead cost of sanitising and maintaining general hygiene. Still, relief measures came few and far in between.

One of the more used relief facilities was the guaranteed loans with a moratoria of two years, as a reduction in sales meant that they were not getting enough to meet their overhead costs, like light bills and rent.

Mohammed added that crashing government websites, and drawn-out processes also slowed things down.

“You would have to do everything online ,but when you go to the site it may not work. Or you would submit your documents and you would still be told that you have to bring in something physical.

"So that defeats the purpose. That by itself would have put a strain on the process.”

Mohammed was concerned that businesses that started applications, but were not able to benefit from the relief, may have to restart the entire process once again.

Chambers added the quantity of the relief was also not enough.

“For a business that makes $25 million a year, a $500,000 is merely a drop in the bucket,” Leladarsingh said. “It would be better if government allocated more money to borrow.”

He said government allocated $300 million for loans, but to really have the right effect, it would need to allocate double that – somewhere around $700 million.

Mohammed said to assist government would need to allot closer to $1 billion. He suggested that the money could be taken from the Heritage and Stabilization Fund, which contains about $5.8 billion.

Chambers know what businesses need

The chambers said while they support measures to keep the virus from spreading until vaccines could be distributed, locking down the economy without a proper strategy in place could be detrimental.

Leladarsingh suggested broadening the conversation, not only to the business chambers but to include UWI, as TT’s repository for information.

“A proper plan must be made going forward,” Mohammed said. “We have business owners coming to our offices every day asking for help, and telling us what they need.”

Mohammed added that government should have contingency plans in place for spikes in cases and new waves, as they have been battling the virus for more than a year.

“When we see the numbers rise, we need to know what would happen. That way we could effectively pivot and improvise.”

He also called for more adjustment to the list of essential businesses, which includes those that support important sectors like the education sector.

“Children are still getting school projects but stationery stores are closed. These are some of the things that we could help government take into consideration.”

Mohammed also asked for businesses to hear from doctors and nurses about vaccination, and to have a forum where they could discuss and ask questions and have the process and the science explained in a way they could understand.

Ultimately, what the chambers called for was to be part of the conversation about balancing life and livelihood.

“We just want to be part of the dialogue,” said Leladarsingh. “Democracy is all about listening to your people, but it is mostly about listening to the most vulnerable and the voices of the minority.”