Rishi Sunak injects support for struggling sectors as UK enters new lockdown

Rishi Sunak injects support for struggling sectors as UK enters new lockdown

UK Chancellor Rishi Sunak announced that businesses in the lockdown-hit sectors such as retail, hospitality and leisure are to receive a one-off grant worth up to £9,000.

As the UK entered its tough new stay-at-home lockdown due to a surge in infections from a highly-transmissible new variant of coronavirus, the British Indian finance minister said he was putting in place the extra measures worth £4 billion in total to help these businesses that would now have to be shut until mid-February.

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.”

Cash boost

The extra 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. The one-off top-ups will be granted to closed businesses on the basis of £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; and £9,000 for businesses with a rateable value of over £51,000.

The new one-off grants come in addition to billions of existing business support, including grants worth up to £3,000 for closed businesses, and up to £2,100 per month for impacted businesses once they reopen.

The UK Treasury department said that 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.

The government said it has also provided 100 per cent business rates relief for retail, hospitality and leisure businesses, £1.1 billion existing discretionary funding for local authorities, the furlough scheme now extended to April and 100 per cent government backed loans, extended until March.

Unprecedented measures

The Treasury also pointed to UK-wide measures as part of an “unprecedented package” of support for business already in place, including the various business lending schemes where the repayment terms were made easier as part of the Winter Economy Plan, and the extension of the Self Employment Income Support Scheme.

It comes as UK Prime Minister Boris Johnson addressed the nation in a televised address to declare a new nationwide lockdown, with coronavirus infection rates threatening to overwhelm the National Health Service (NHS). He was also forced to call off his planned visit to India for the Republic Day ceremony on January 26 and spoke to Indian Prime Minister Narendra Modi to express his regret.

“In light of the national lockdown, and the speed at which the new coronavirus variant is spreading, the Prime Minister said that it was important for him to remain in the UK so he can focus on the domestic response to the virus,” Downing Street said.

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