Business Disruption Loan Guarantee Scheme: Extension to 31 March 2021

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A decision made on 17 December 2020

Decision Reference: MD-TR-2020-0161
Decision Summary Title:	Business Disruption Loan Guarantee Scheme extension		Date of Decision Summary:	17th December 2020
Decision Summary Author:	Associate Director, Financial Services		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	n/a
Written Report Title:	Business Disruption Loan Guarantee scheme – December 2020 extension		Date of Written Report:	17th December 2020
Written Report Author:	Associate Director, Financial Services		Written Report: Public or Exempt?	Public
Subject: Extension of the Business Disruption Loan Guarantee Scheme
Decision(s): The Minister decided to extend the Business Disruption Loan Guarantee Scheme to 31 March 2021
Reason(s) for Decision: The extension allows the scheme to be used until the end of 2020, allowing businesses to borrow from banks participating in the scheme for an additional 3 months. Article 28 of the Public Finances (Jersey) Law 2019 provides that: 28 Guarantees and indemnities (1) The Minister may, in the name of the States, provide guarantees or indemnities. (2) The total amount of all guarantees and indemnities under paragraph (1) that may be provided during a financial year must not exceed £3 million. The total outstanding amount of all guarantees and indemnities under paragraph (1) at any given time must not exceed £20 million.
Resource Implications: The approach does not allocate further funding to the scheme but relies on the Minister’s ability to issue guarantees under the Public Finances (Jersey) Law 2019. Accordingly, the extension of the scheme in this manner restricts the ability of the Minister to issue guarantees for separate purposes. Government employees have been engaged in monitoring the scheme since its launch at the beginning of April 2020. This will continue regardless of whether the scheme is extended due to the need to monitor existing exposures, so the staffing impact is negligible. Law Officer time is required to draft an amendment to the agreement with banks, which is expected to be limited and manageable within normal business resource.
Action required: Head of Financial Governance to ensure this decision is published on www.gov.je and advise the Associate Director, Financial Services that it has been signed. Associate Director, Financial Services to ensure this decision is communicated to the banks who are participants in the Business Disruption Guarantee Scheme and confirm their approval to enter into an amended contract expiring on 31 March 2021.
Signature:		Position: Deputy Susie Pinel Minister for Treasury and Resources
Date Signed:		Date of decision