£ 1bn in support for companies most affected by Omicron in the UK

  • Businesses in the hospitality and leisure sectors in England will be eligible for one-off grants of up to £ 6,000 per local, and over £ 100million in discretionary funding will be made available to local authorities for support other companies
  • The government will also cover the cost of statutory sickness benefits for Covid-related absences for small and medium-sized employers across the UK
  • Additional £ 30million funding will be made available through the Culture Recovery Fund, allowing more cultural organizations in England to apply for support during the winter

Recognizing that the rise of the Omicron variant means that some businesses are likely to experience difficulties in the coming weeks, the government is providing one-time grants of up to £ 6,000 per local for businesses across the hospitality and leisure in England.

At what is often their most profitable time of year, many pubs and restaurants have seen cancellations and drop in attendance as people reacted to the surge in the number of cases leading up to Christmas, Hospitality UK reporting that many businesses lost 40 to 60% of their December month. trade, often their most profitable month.

About 200,000 businesses will be eligible for business grants which will be managed by local authorities and will be available in the coming weeks.

Given the uncertain situation facing businesses, the government has chosen to provide generous grants, which are equivalent to the monthly cash grants given to host businesses when they were shut down completely earlier this year, although that companies can still do business.

The effectiveness of government policies in supporting the economy during the pandemic and the success of businesses in learning to adapt mean the economy is in a different situation now than it was at the start of the crisis.

Many businesses have more money in the bank than they had at the start of the pandemic and the net cash deposits of all hotel companies have increased by £ 7bn (40%), while small and mid-size hotel industry companies saw their cash deposits increase by £ 2 billion (79%).

Fewer companies have gone insolvent, with insolvencies 25% lower than pre-pandemic hospitality, and vacancies are 50% higher than pre-pandemic levels.

Prime Minister Boris Johnson said:

With the increase in Omicron cases, people are rightly exercising more caution in their lives, impacting our hospitality, leisure and culture sectors in what is typically the peak period. busiest of the year.

This is why we are taking immediate action to help with an additional £ 1bn in subsidies to these industries and reintroducing our sickness benefit reimbursement program.

I urge people across the country to lend a helping hand now to provide vital protection for yourself, your loved ones and your communities.

Chancellor of the Exchequer, Rishi Sunak said:

We recognize that the spread of the Omicron variant means that companies in the hospitality and leisure industries face enormous uncertainty, at a crucial time.

So we are stepping in with £ 1billion in support, including a new grant program, the reintroduction of the statutory sickness benefit reimbursement scheme and additional funding released through the Culture Recovery Fund.

At the end of the day, the best thing we can do to support business is get the virus under control, so I urge everyone to get boosted now.

To support other businesses impacted by Omicron – such as those supplying the hospitality and leisure industries – the government is also giving the Addition Restrictions Grant (ARG) a boost of more than £ 100million to local authorities in England.

Local authorities will have the discretion to allocate this funding to businesses that need it most. The ARG recharge will be a priority for the local authorities which have distributed the majority of their existing endowment. This is in addition to the £ 250million in previously allocated funding that remains with local authorities.

As the growing number of Covid-19 cases means more workers are taking time off work, the government is also reintroducing the Statutory Sickness Benefit Reimbursement Scheme (SSPRS).

The SSPRS will help small and medium-sized employers – those with fewer than 250 employees – by reimbursing them for the cost of statutory sickness benefits for Covid-related absences, up to 2 weeks per employee. Businesses will be eligible for the scheme from today and they will be able to make claims retrospectively from mid-January.

To provide continued support to the cultural sector, additional funding of £ 30million will be made available through the Culture Recovery Fund to support organizations such as theaters, orchestras and museums during the winter through March 2022.

This figure will build on nearly £ 240million in cultural grants already allocated this fiscal year or currently available to organizations they can bid on.

During the pandemic, the UK government provided nearly £ 2bn to support our vital cultural sector, with the first round of £ 1.57bn of the Culture Stimulus Fund announced in July 2020.

The UK government works closely with its counterparts in government departments and decentralized businesses in all parts of the UK.

As part of this support announced today, decentralized administrations will receive around £ 150million in funding through the Barnett Formula, of which around £ 80million goes to the Scottish government, £ 50million to the Welsh government and £ 25million for the Northern Ireland executive. .

This contributes to the additional £ 860million funding announced by the UK government last week to support decentralized administrations, allowing them to provide additional support to businesses in Scotland, Wales and Northern Ireland as they see fit. .

These additional measures will strengthen the existing business support package, including:

  • business rate relief, which means the majority of businesses in the hospitality and leisure industries will see a 75% reduction in their business rate bill over the full year and further relief business rates capped at 50% next year;
  • a reduced VAT rate of 12.5% ​​for hotels and tourism to support the cash flow and viability of around 150,000 businesses and protect more than 2.4 million jobs, until the end of March;
  • the £ 1.5 billion Covid Supplemental Relief Fund for businesses that had not previously received commercial tariff support;
  • businesses will be protected from eviction if they are behind in renting their premises, thanks to the moratorium in place until March 2022;
  • access to finance for SMEs via the Recovery Loan Scheme until June; and
  • Bounce Back Loan repayment flexibility, with borrowers having the option of taking 6-month repayment leave, three 6-month interest periods only, or extending their loan to 10 years almost halving the payment monthly.
  • support for the aviation and travel sectors, including more than £ 12 billion since the start of the pandemic, and the Airport and Ground Operations Support Program (AGOSS) until the end of March 2022.
  • The HMRC is ready to support any business affected by the coronavirus pandemic through its Time to Pay deal, and the Chancellor has asked them to offer businesses in the hospitality and leisure sectors, in particular the possibility of a short deadline and payment in installments, on a case-by-case basis, within the framework of this one.

More information :

Funding consists of:

  • £ 683million for targeted grants for hospitality and leisure businesses in England
  • £ 102million top-up for the additional restrictions grant
  • £ 30million for the Culture Recovery Fund
  • £ 154million in Barnett funding covering the above three
  • Funding for the reimbursement scheme for statutory sickness benefits will be added to these amounts.
  • Further information will be available in the published fact sheets.

About Christopher Easley

Christopher Easley

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