Businesses in the retail, hospitality and leisure sectors are to receive a grant worth up to £9,000 to help them survive the current lockdown.
The grants announced by chancellor Rishi Sunak are part of a support package worth £4.6 billion intended to help businesses survive through to the Spring. The announcement follows prime minister Boris Johnson's imposition of a third national lockdown, and with it the instruction that businesses in retail, hospitality and leisure must, once again, close.
The lockdown will be in place until 22 February or longer as the government battles to control the virus. The cash is to be provided on a per-property basis to support businesses through the latest restrictions, and is expected to benefit over 600,000 business properties and is worth £4 billion in total across all nations of the UK.
The one-off grants will be given to closed businesses as follows:
- £4,000 for businesses with a rateable value of £15,000 or under;
- £6,000 for businesses with a rateable value between £15,000 and £51,000;
- £9,000 for businesses with a rateable value of over £51,000.
A further £594 million is also being made available for local authorities and the devolved administrations to support other businesses not eligible for the grants, that are affected by the restrictions. Businesses should apply to their local authorities for this money.
The new support comes in addition to existing business support, including grants worth up to £3,000 for closed businesses, and up to £2,100 per month for impacted businesses once they reopen.
Chancellor Rishi Sunak said: "Throughout the pandemic we've taken swift action to protect lives and livelihoods and today we're announcing a further cash injection to support businesses and jobs until the Spring. This will help businesses to get through the months ahead - and crucially it will help sustain jobs, so workers can be ready to return when they are able to reopen."
The government has also provided 100% business rates relief for retail, hospitality and leisure businesses as well as £1.1 billion existing discretionary funding for local authorities. Before Christmas, Rishi Sunak announced that the furlough scheme would be extended to April and 100% government backed loans would be extended until March.
Commenting on the latest announcement, the British Chambers of Commerce (BCC) has warned that the new support won't stop some businesses going under. BCC director general Adam Marshall said: "While this immediate cash flow support for business is welcome, it is not going to be enough to save many firms. We need to see a clear support package for the whole of 2021, not just another incremental intervention.
"The government must move away from this drip-feed approach and set out a long-term plan that allows all businesses of all shapes and sizes to plan, and ultimately survive.
"Many smaller firms won't qualify for the full headline amounts set out in the chancellor's statement, and will be left struggling to see how this new top-up grant will help them out of their cashflow problems.
"Support must be sufficient to cover not just those on the front line of retail, hospitality and leisure, but also firms in supply chains and wider business communities who are also feeling the devastating impacts of these restrictions."
Written by Rachel Miller.