SPOA Vice President raises concerns with Scottish finance secretary over current coronavirus support offerings

The letter from the Vice President comes after listening to growing concerns from members who have either been left out from CORONAvirus support offerings or have found themselves to be unfairly ineligible for support.

In full is the letter below, we encourage all members to get in touch with any concerns they have surrounding the subject using the contact form.

26 May 2020

Dear Kate Forbes

I write to you today to raise concerns as both a businessman and as the Vice President of the Scottish Plant Owners Association. The SPOA was established in 1950 to represent the construction plant industry in Scotland, today we represent around 300 member businesses who contribute approximately £1bn to the Scottish economy.

On the 22nd May you made comment via your social media channels with regards to business support - I write to you today with concerns over the support offered to certain businesses, or more specifically the lack of support available to those in the construction plant sector who have no need for premises yet still run genuine bona fide businesses.

As you know, after a period of governmental indecision the construction sector was told in April to down tools until such time that the Government deems it acceptable to return to work. Some of our members have been able to access support such as SEISS and the Small Business Grant Scheme and those who operate a hire centre have been successful in obtaining a Retail Support Grant.

We welcome the support available however it’s the first two forms of support which I’d like to share my concerns about which affect 27% of our membership.

Self Employed Income Support Scheme (SEISS):

Our industry is all about machinery and with ever changing emissions regulations we need to continually reinvest profits year on year into the latest greenest/cleanest equipment to ensure our clients and our country meets its emissions targets. This investment will have to continue at a greater rate due to the UK Governments removal of red diesel subsidy to encourage greener technology thus requiring further machinery renewal.

Because of that continual reinvestment many of our smaller self-employed members have been able to claim capital allowances, but as a result are not eligible or barely eligible for SEISS. This is a sore blow when they’re ensuring their employees have been paid via the furlough scheme yet aren’t eligible for the equivalent themselves.

In effect, such members who have invested in the future by buying equipment are then treated as if they have avoided tax when it comes to SEISS claims.

Why are capital allowances deducted before the calculation of profit from which SEISS claims can be made?

Small Business Grant Scheme:

With the 2^nd phase of the scheme underway, this scheme should really be renamed the Small Business Premises Holders Grant Scheme as it misses out many.

27% of our members have no need for business premises and carry out their admin from home. Their equipment stays on the customers sites and moves location with each contract. These businesses still have hefty overheads including HP/Lease arrangements, Insurance and sadly also the costs of repairing machines vandalised on site over lockdown this is above their own personal living costs.

As my SPOA colleague and fellow businessman Paul McCormack explained in his letter to the First Minister and Cabinet dated 27/04/20 letter (a letter to which the only response to date has been from Finlay Carson MSP), our industry is heavily burdened with high HP/Lease payments and though payments can be deferred for up to three months it it is only a delay not a waiver.

Also, going forwards cash will be required to pay for the new extra H&S measures required, wages of employees once they are out of out of the Job Retention Scheme and the usual supplier payments.

Why does the scheme assume that a business with premises has more need for support than one without?

I urge you to consider what more can be done to assist our members and the wider construction industry in Scotland. The SPOA motto is “Working Together to Derive Mutual Benefit”, whilst there is a power of work yet to be done I do believe WE can work together to find a solution to the points raised and ensure our industry pulls through this crisis for the greater benefit of the Scottish economy... doing otherwise is not an option.

I await your response

Regards,

Callum Mackintosh

Vice President - Scottish Plant Owners Association

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