The Valencian Government will give direct aid to companies that prove that they were viable before the pandemic

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With the pandemic running rampant and the autonomous communities tightening restrictions to face the third wave, the economic sectors most affected clamored for direct aid that the Government had promised and that, however, had not yet materialized. The Valencian Community will take a step in this direction, with a shock plan that promises to mobilize 340 million euros and that, above all, it contemplates for the first time a lifeline for companies and the self-employed that will cover Social Security contributions.

This was announced yesterday by the President of the Generalitat, Ximo Puig, who advanced a line of 80 million euros for discount up to 100% of those fees paid by more than 21,000 companies and 43,000 self-employeds one of the sectors hardest hit by the restrictions. Specifically, hotels and tourist accommodation, travel agencies, artistic and leisure activities (including nightlife).

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They will not, therefore, be indiscriminate aid, but rather focus on the sectors that accumulate 59% of the job destruction in the Valencian Community since the beginning of the pandemic. Moreover, according to sources from the Generalitat, companies and freelancers will be required to prove that they were viable before the pandemic. In other words, the Valencian Government seeks to avoid the injection of public money into companies that, in any case, were destined for bankruptcy.

In addition, another 8 million euros will be given to 26,000 self-employed people more affected by the total closure of their activity or the drastic reduction in income, while another 17 million will go to the 48,000 workers who are still at ERTE. In addition, there will be a specific help line for discos and nightclubs that have had to close.

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On the other hand, through the public bank of the Generalitat a line of soft loans up to 750,000 euros, with the novelty that they include a non-refundable part. It is the other way of quickly injecting liquidity into companies, since the Generalitat assumes that the speed with which this shock plan is put in place – agreed with the autonomous employers’ association CEV and the unions CCOO and UGT – will depend partly from the transfer of data from the SEPE and the Tax Agency. To the point that no one dared yesterday to specify when the first aid will be effective.

In fact, both the employer and the Association of Autonomous Workers (ATA) claimed agility in the processing of aid. Aid that, on the other hand, will come from European funds. Specifically, the React-EU program, from which the Valencian Community will receive 1,250 million.

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