Amazon has pocketed 40 per cent of the £5billion extra cash spent online by Britons throughout the coronavirus pandemic, MPs were told today.
Shadow business minister Chi Onwurah has called on the Government to provide ‘firm commitments’ to support small businesses against the rising popularity of digital retailers, adding many shops are ‘afraid they won’t make it through the winter.’
Amazon is among the world’s richest corporations, with its owner Jeff Bezos worth £84billion ($113billion), making him the richest person in the world.
Business minister Nadhim Zahawi said the Government is spending £300million to ‘support technology adoption into manufacturing’ to assist smaller companies.
Amazon has pocketed 40 per cent of the £5billion extra cash spent online by Britons throughout the coronavirus pandemic, MPs were told today. Pictured: Stock image
Speaking during business departmental questions in the Commons, Ms Onwurah told MPs: ‘Of the £5billion of new online spend because of the pandemic, 40 per cent has gone to one website – Amazon.
‘Many small businesses are afraid they won’t make it through the winter because of the lack of Government support and they have Brexit, climate and technological change to deal with too.
‘So I want to ask the minister, what is the plan for small businesses to survive Covid and build back smarter and greener?’
Ms Onwurah urged the Government to provide ‘not vague promises, but firm commitments’ to help small businesses.
Shadow business minister Chi Onwurah (pictured) has called on the Government to provide ‘firm commitments’ to support small businesses against the rising popularity of digital retailers, adding many shops are ‘afraid they won’t make it through the winter’
Mr Zahawi replied: ‘I think (Ms Onwurah), as a fellow engineer, will know that the Made Smarter initiative has been a tremendous pilot in the North West and we recently announced a further expansion with £300 million – £147 million coming from Government and the balance coming from the private sector – to support technology adoption into manufacturing.’
It comes as MPs were told how tens of billions of pounds dished out as loans to keep struggling firms afloat during the pandemic are instead being hoarded in bank accounts.
Some £21billion – half of the total £42billion doled out by Rishi Sunak under various schemes – has yet to be used by the businesses that claimed it, representatives of UK banks said.
The money was designed to help firms with rent and other expenses during the lockdowns and the general economic disaster that has been 2020.
They are underwritten by the Treasury, meaning the taxpayer foots the bill if they are not paid back by the recipient.
Amazon is among the world’s richest corporations, with its owner Jeff Bezos worth £84billion ($113billion), making him the richest person in the world. Pictured: Shoppers in London today
Pictured: Shoppers on Oxford Street in London amid the coronavirus pandemic today
Paul Thwaite, the head of commercial banking at NatWest, told the Treasury Select Committee yesterday: ‘Some customers have exercised caution, drawn down on the lending and kept it for future spending.’
He said that firms in the leisure, accommodation and retail sectors were those that were most likely to actually be using the funding.
The panel of witnesses to the committee, which also included Anne Boden, chief executive of Starling Bank, and David Oldfield, chief executive of Lloyds Commercial Banking, also suggested around 25 per cent of loans are likely to never be repaid.
However, all said it was ‘too early to say’ how high it could be.
They called on the Government to be more engaged with the banking sector to ensure any rule changes are given in advance so customers are not given conflicting advice.
Business minister Nadhim Zahawi said the Government is spending £300million to ‘support technology adoption into manufacturing’ to assist smaller companies. Pictured: London today
Ms Boden said: ‘I think that we have to start thinking about what happens when this scheme finishes. We really need written notice.
‘When it came to extending some of the holiday schemes, we heard the night before. We’d sent all the information out to customers and we had to change everything.’
Mr Oldfield added: ‘There is no doubting in my mind that small firms will need to continue with support beyond January 31 and it’s not yet precisely clear what that will look like.
‘Secondly, we need a very clear and consistent set of Government and industry processes for those who will be struggling in the months and years ahead so we do this in a joined-up and fair way.’
Mr Thwaite said: ‘I would encourage the Government to stay flexible. We definitely need solutions for the public and private sector around the levels of corporate indebtedness.’
So far £42.2billion of bounce back loans have been provided to businesses.
An extra £1.6billion has been lent in Coronavirus Business Interruption loans (CBILS), and about £270million in CLBILS, which is for larger companies.