Businesses in the retail, hospitality and leisure sectors are to receive a one-off grant worth up to £9,000, the Chancellor has announced.
This follows the Prime Minister’s announcement that these business will be closed until at least February half-term in order to help control the virus.
The cash is provided on a per-property basis to support businesses through the latest restrictions, and is expected to benefit over 600,000 business properties, worth £4 billion in total across all nations of the UK.
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 might be affected by the restrictions. Businesses should apply to their Local Authorities.
The one-off top-ups will be granted 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
Commenting on the support measures for business announced by the Chancellor, British Chambers of Commerce 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.”
Federation of Small Businesses (FSB) National Chair Mike Cherry said: “While this additional financial support will be a lifeline to 600,000 businesses and therefore has value, there is a need for a plan that matches the scale of the economic damage we are seeing.
“For many it just won’t be enough for businesses who are already under the cosh and on the brink.
“These funds come after a disappointing festive period and are followed by a last minute lockdown and do not go far enough to match the scale of the crisis that small firms are facing.
“There remain too many groups who need more support to weather this storm such as the newly self-employed, those in supply chains and company directors. We continue to call on the government to create a Directors Income Support Scheme, mirroring the Self Employed Support Scheme, in the form of a taxable grant for directors of limited companies calculated at 80% of three months average monthly trading profits, paid out in a single instalment and capped at £7,500.
“We also need to see the government make clear its plans for more finance capabilities made available to those who have used their allocations through Bounce Bank Loans as well as extending the period before repayments begin.
“This lockdown is expected to last for some time, even when restrictions ease, many small firms will be unable to function at 100 per cent, if at all. Which is why the government should create a Spring Economy Plan to help firms get through to drive a vaccine-enabled recovery.
“After clawing their way through 2020, the start of the new year looks set to be an even worse one for many. Small businesses are the backbone of our economy, and it is absolutely vital we support them in every way possible until the crisis finally begins to ease.”
Roger Barker, Director of Policy at the Institute of Directors, said: “This new grant package is welcome, and will go some way to reassuring the worst affected businesses.
“We are particularly pleased the Treasury has taken on board our recommendation to increase the discretionary local authority grant fund. This policy has helped to reach those who haven’t been able to access other support. The Government should be prepared to top up the fund if necessary.
“The Chancellor must remain wary of a Spring cliff-edge in business support as the furlough scheme and other support measures unwind. Businesses will also be keen for the Government to continue setting out its plans for the vaccine roll-out, to support their planning. The path of the virus is extremely uncertain, and Government must be agile in its response to prevent lasting economic damage.”
