Economy  

Govt announces £1bn support for Covid-hit businesses

Govt announces £1bn support for Covid-hit businesses
Rishi Sunak, chancellor of the Exchequer

Chancellor Rishi Sunak has set out a further £1bn in support to help businesses that have been hit by the latest coronavirus variant and subsequent rise in cases.

The support, announced this afternoon (December 21), includes one-off cash grants of up to £6,000 per premises for each eligible firm in the hospitality and leisure sectors.

This covers pubs and restaurants which have seen cancellations and reduced footfall as people have stayed at home due to the rise in infections ahead of Christmas.

The government said around 200,000 businesses will be eligible for business grants which will be administered by local authorities and will be available in the coming weeks.

The government is also helping certain firms with the cost of sick pay for Covid-related absences.

The reintroduced Statutory Sick Pay Rebate Scheme (SSPRS) will help employers with fewer than 250 employees by reimbursing them for the cost of statutory sick pay for Covid-related absences, for up to two weeks per employee. 

Firms will be eligible for the scheme from today (December 21) and they will be able to make claims retrospectively from mid-January.

There is also £30m in funding to help theatres and museums through the winter to March 2022.

Sunak said: “We recognise that the spread of the Omicron variant means businesses in the hospitality and leisure sectors are facing huge uncertainty, at a crucial time.

“So we’re stepping in with £1bn of support, including a new grant scheme, the reintroduction of the Statutory Sick Pay Rebate Scheme and further funding released through the Culture Recovery Fund.

“Ultimately the best thing we can do to support businesses is to get the virus under control, so I urge everyone to get boosted now.”

But the measures have been called “a drop in the ocean” compared to the support that has been on offer previously.

Nimesh Shah, chief executive officer at Blick Rothenberg, said: “The £6,000 per premises grant for eligible businesses offers very little and arguably businesses have already lost more than that during December, as government measures and announcements around Omicron have led to mass cancellation of events and parties in the run-up to Christmas.”

Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said one of the main problems was that many companies do not know how long people will stay away or whether lockdown restrictions will be introduced in the new year.

Streeter said: “The call for greater clarity over the next steps is likely to continue and sentiment in the financial markets will hang on every word about the virulence and severity of the new strain."

amy.austin@ft.com

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