Measures to support the economy strengthened but still insufficient for many companies

The main measures

Partial unemployment

This system of support for salaries by the State and Unedic, to protect jobs and skills, has already cost 22 billion euros. Due to the closure of 300.000 businesses employing over a million people, it will cost an additional 7 billion until the end of November.

The level of this support has changed over time and depending on the sector.

Closed businesses will be entitled to it with zero charge for the employer, announced Mr. Castex, aid that already applied to the tourism sectors and related activities (restaurants, hotels, culture, events, etc.)

During the first confinement, the employee received 70% of his gross salary and the company was compensated at 100% up to 4,5 times the minimum wage (instead of the minimum wage level previously). Then, after confinement, the government had reduced the wing: companies were no longer compensated at 85%, except for the most affected sectors.

A maximum of 8,6 million employees were affected by this device in April and more than a million were still in September, according to the latest figures from the Ministry of Labor.

Carry forward and exemptions from charges

All businesses with fewer than 50 employees that are administratively closed will be exempt from social security contributions, as well as those in the tourism, sport, culture and events sectors if their turnover falls by more than half during this period.

Self-employed contributions will be automatically suspended.

At the beginning of August, the only deferral of social contributions amounted to 21,1 billion euros.

SMEs and VSEs could already spread their repayment up to 36 months.

The outright exemptions that had already been granted in tourism and related sectors for an amount have been valued at 5,2 billion euros by the government.

In terms of taxation, requests for postponements (property tax deadline, etc.) are always possible for the companies in the most difficulty.

Solidarity fund

Designed in March to support smaller businesses and the self-employed, it provides for the payment of a monthly allowance to compensate for part of their loss of activity linked to activity restrictions and the crisis.

Its access and the amounts allocated have been considerably increased as the crisis worsened and between 6 and 7 billion euros have already been spent in this context.

Its new version will cost an additional 6 billion by the end of November, said Bruno Le Maire.

Now available to companies with less than 50 employees across the country, it will compensate for loss of turnover up to 10.000 euros for all closed companies, or for those in the tourism and related sectors (catering , events, culture, etc.) whose turnover will drop by at least 50% compared to the same period of 2019.

All other companies suffering a loss of at least half of their turnover will be eligible for aid of 1.500 euros.

State guaranteed loans

To support the cash flow of companies in all sectors, the State has set up this mechanism with banking organizations in which it provides its guarantee for loans requested by companies.

The government has budgeted a maximum of 300 billion euros, and as of October 16 more than 123 billion euros have been granted to nearly 600.000 companies.

Its access has been extended until June 30, 2021 since the curfew was announced.

Bruno Le Maire announced that the deferral of repayment of these guaranteed loans could be extended from one to two years after the banks' agreement, an extension which was negotiated with Brussels because it could have been assimilated to an undue competitive advantage.

Direct government loans

For companies that cannot find any other financing solution, the State can grant loans up to 10.000 euros for companies with less than 10 employees and up to 50.000 euros for those with 10 to 49 employees. The government has set aside 500 million euros for this purpose.

Commercial leases

Landlords will be able to obtain a 30% tax credit on their rents in exchange for waiving at least one month's rent over the October - December period, a measure the government hopes will resolve the many disputes surrounding the landlords. unpaid rents between traders and the owners of their walls.

Construction professionals welcome the measures, but call for financial and methodological support

Following the announcement of the reconfinement, the CINOV Federation, an employers' federation representing professions in the provision of intellectual services in consulting, engineering and digital technology, takes note of the need to toughen restrictive measures in the context of the fight against the COVID-19 epidemic. CINOV welcomes the adaptations which will make it possible to protect the economy and the activity of companies, but asks that they be supported financially and methodologically in the brutal transformations they find themselves facing.

Provide businesses with the means to adapt to new measures

Following Emmanuel Macron's speech and the announcement of new restrictive measures in the fight against COVID-19, the CINOV Federation wishes to welcome the fact that this re-containment is being done in a more flexible framework for companies , in order to preserve as much as possible their activity, already largely impacted by the 1st wave of the epidemic.

Nevertheless, CINOV stresses that companies are once again forced to adapt very quickly and without preparation for these new measures (teleworking, digitalization) and therefore calls for the establishment of financial and methodological support for the most demanding companies. impacted by these new measures.

“Our members, specializing in the provision of intellectual services, are at the forefront of the observation of the situation because they intervene in all areas. The finding is the same everywhere, all sectors of activity are overdue, and the latter will be further accentuated with these new restrictions. It is therefore crucial, beyond financial support, to effectively support companies in the transitions (digital, environmental, organizational, etc.) they find themselves facing ”

Frédéric Lafage, President of the CINOV Federation

The fear of a cascade effect for companies in the BETIC branch

The BETIC branch is 99,5% made up of VSEs and SMEs which have suffered the full economic consequences of the first wave of the epidemic. The announcement of a new confinement raises fears of the scenario of cascading failures among the customers of these companies. This is why the CINOV Federation asks that the cash flow assistance and recovery plan be considerably increased and above all monitored in its execution.

"It is crucial that public procurement is maintained and that the digitization of public services accelerates so that the chain of command and execution does not stop" underlines Frédéric Lafage, President of the CINOV Federation. "The new economic measures that will be taken to support businesses and economic activity at the national level should enable us to effectively support the digital and ecological transition of organizations".