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Businesses to receive £9k grants as part of £4.6bn lockdown package
5 January 2021, 09:10 | Updated: 5 January 2021, 10:14
Businesses are to receive a one-off grant worth up to £9,000 as part of a £4.6 billion support package for the third national lockdown, Rishi Sunak has announced.
The chancellor promised more funding to firms in the retail, hospitality and leisure sectors this morning after Boris Johnson confirmed the country would be heading into another coronavirus lockdown on Monday.
Tougher restrictions will leave businesses in England closed until at least the February half-term in a bid to curb rising Covid-19 infections.
As part of Mr Sunak's new relief package, there will also be a £594 million discretionary fund made available to local authorities and the devolved administrations to support other companies affected by the measures.
The funding is hoped to reach more than 600,000 businesses across the UK and will be worth more than £4 billion in total.
The Scottish Government will receive £375 million, the Welsh Government £227 million and the Northern Ireland Executive £127 million.
Mr Sunak said: "The new strain of the virus presents us all with a huge challenge - and whilst the vaccine is being rolled out, we have needed to tighten restrictions further.
"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."
Businesses should apply to their local authorities for access to the £594 million discretionary fund, the Treasury said.
The one-off grants will be linked to business rates, with payments of £4,000 for businesses with a rateable value of £15,000 or less, £6,000 for businesses with a rateable value of between £15,000 and £51,000, and £9,000 for businesses with a rateable value of more than £51,000.
We’ve been calling for additional cash grants to hard pressed businesses for weeks (using repaid supermarkets rates cash).— Lucy Powell MP (@LucyMPowell) January 5, 2021
These direct cash grants are welcome, but it depends how long these restrictions last for as they are one off.
Sticking plaster ... https://t.co/3kt43AdEx7
However, the chancellor stopped short of extending the business rates holiday, which ends in April, despite calls from retail and hospitality leaders for such a move.
Other noticeable absences being called for by business groups and unions include a VAT cut and improvements to sick pay or support for working parents.
Meanwhile, the shadow business minister Lucy Powell branded the funding a "sticking plaster" due to their one-off nature.
The Labour MP said on Twitter: "We’ve been calling for additional cash grants to hard pressed businesses for weeks (using repaid supermarkets rates cash).
"These direct cash grants are welcome, but it depends how long these restrictions last for as they are one off.
"Sticking plaster ..."
Good as far as it goes but no mention of people excluded from public support.— Andy Burnham (@AndyBurnhamGM) January 5, 2021
Does the Government really have no intention of bringing 3 million taxpayers in from the cold?
If not, Parliament should call a vote on this tomorrow. https://t.co/Qe2QGXIJrq
Likewise, Mayor of Greater Manchester Andy Burnham said: "Good as far as it goes but no mention of people excluded from public support.
"Does the Government really have no intention of bringing 3 million taxpayers in from the cold?
"If not, Parliament should call a vote on this tomorrow."
The new one-off grants come in addition to grants worth up to £3,000 for closed businesses, and up to £2,100 per month for impacted businesses once they reopen.
Ministers have already provided £1.1 billion of discretionary funding for local authorities, extended the furlough scheme until April and taxpayer-backed business loans until March.