Chancellor Unveils New £1bn Covid Support Package for Businesses

A bailout package worth about £1bn for UK businesses has recently been announced by the Chancellor, Rishi Sunak in response to the Omicron Covid-19 outbreak. The funding will primarily help firms in the leisure and hospitality sector, and follows concerns that they have faced cancelled bookings and plummeting custom since the Government implemented its Covid “plan B”.

The bailout package consists of four elements:

  • Grants for hospitality and leisure businesses in England, worth up to £6,000 per premises. The Treasury has set aside £683m for these payments, administered through local authorities and available in the coming weeks. Check out the Harrogate BC website for details of how the scheme will be administered.
  • Further grants for businesses in England, worth £102m, intended to help businesses most in need, and again administered through local authorities.
  • The resumption of the statutory sick pay rebate scheme, which will reimburse employers in the UK with fewer than 250 workers for the cost of paying statutory sick pay for Covid-related absences for up to two weeks.
  • An extra £30m for arts organisations, paid through the culture recovery fund.

In addition, the Scottish government will receive £150m, the Welsh government £50m and the Northern Ireland executive £25m under the Barnett formula to offset the England-only spending.

These positive measures should help alleviate the intense pressures that small firms in the affected sectors are currently under, and hopefully arrest a significant recent decline in confidence. This move should be a significant help to those businesses who are struggling most with depleted cashflow – it is vital that small firms can reclaim the costs of supporting staff as business income suffers. The encouragement of HMRC to give as much breathing space as possible to small firms as we head towards tax return season will also come as a relief to many.

More information available on the Government’s Website.