Chancellor announces £1bn support package for Covid-hit firms

Rishi Sunak has offered a £1 billion support package to businesses hit by Covid restrictions.

Tuesday, 21st December 2021, 8:13 pm

The Chancellor has come forward with £1bn additional help for the hospitality and leisure sectors in England following days of urgent lobbying from MPs, firms and industry officials – and he has been accused of ‘dragging his feet’ over the decision.

It comes amid concerns over the “eye-wateringly high” transmission of the Omicron variant, and includes one-off grants of up to £6,000 per premises for businesses in the affected sectors in England.

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hancellor of the Exchequer Rishi Sunak

The Treasury expects it will be administered by local authorities and to be available in the coming weeks.

The Government also intends to use taxpayers’ cash to cover the cost of statutory sick pay for Covid-related absences for firms with fewer than 250 employees.

Cultural organisations in England can also access a further £30 million funding during the winter via the culture recovery fund, the Treasury said.

Shadow chancellor Rachel Reeves said Labour “will be going through the details” of the new measures, adding that the Government had been “dragged kicking and screaming” to announce them.

Mr Sunak’s announcement follows crisis talks with business leaders after he cut short a Government business trip to California.

Businesses have seen takings plummet due to Christmas festivities being scaled back amid fear over the spread of Omicron.

And yesterday South Yorkshire Mayor Dan Jarvis called for Government support for businesses who face another winter where hundreds of bookings have been cancelled last minute, as people choose to stay at home and try to avoid catching Omicron.

The warnings come as Sir Jeremy Farrar, director of the global charitable foundation Wellcome, warned “we’re in the most difficult, most uncertain time, perhaps of the whole pandemic, certainly since March of 2020”.

Paul Hunter, Professor in Medicine at the University of East Anglia (UEA), also said the previous rapid increase in cases appears to be slowing and, if that is true, there is no need for a lockdown.

Prime Minister Boris Johnson said of the new funding: “With the surge in Omicron cases, people are rightly exercising more caution as they go about their lives, which is impacting our hospitality, leisure and cultural sectors at what is typically the busiest time of the year.

“That’s why we’re taking immediate action to help with an extra £1 billion in grants to these industries and reintroducing our Statutory Sick Pay Rebate Scheme.

“I urge people across the country to please get boosted now to secure vital protection for yourselves, your loved ones and your communities.”

Mr Sunak added: “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 £1 billion 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.”

The extra support builds on existing schemes in place to assist businesses, the Treasury said.

The devolved administrations will receive around £150 million of funding through the Barnett formula as part of the support announced, the department added.

This includes around £80 million for the Scottish Government, £50 million for the Welsh Government and £25 million for the Northern Ireland Executive.