What financial support is now available for businesses?
The Treasury has announced Â£ 1 billion in financial support for hospitality and leisure businesses affected by the spread of the Omicron variant of Covid-19 in recent weeks.
The companies have asked Chancellor Rishi Sunak for financial support after witnessing massive cancellations and a drop in attendance.
Hotel trade bosses said many companies saw their revenues in December, typically the busiest month for the industry, cut by about half.
Mr. Sunak has now announced a number of potential programs for companies needing additional funds to keep their operations afloat.
He also highlighted some remaining support measures and programs that have been put in place as a result of the pandemic.
Here, the PA News Agency examines the support available to businesses:
– Hospitality and leisure grants
The Treasury has allocated Â£ 683million in funding for targeted grants for hospitality and leisure businesses in England.
Businesses will be eligible for one-time grants of up to Â£ 6,000 per local, the government said.
– Additional grants
Funding of Â£ 102million will also be made available for other grants, which will be made by local authorities to other businesses affected by the pandemic.
This additional funding will likely be made available to areas such as retailers, suppliers and the owners of the businesses involved.
About 200,000 businesses will be eligible for business grants which will all be administered by local authorities and will be available in the coming weeks.
– Sickness benefit
The government has said it will also cover the cost of statutory sickness benefits for Covid-related absences and midsize employers across the UK.
This will be done through the reintroduction of the government sickness benefit reduction scheme (SSPRS).
The plan reimburses companies with fewer than 250 employees for up to two weeks of Covid-related sickness benefits per employee.
Businesses will be eligible for the scheme from Tuesday and will be able to make claims retrospectively from mid-January.
– Funding of cultural revival
Around Â£ 30million in additional funding will also be made available through the Culture Recovery Fund, allowing arts and culture organizations to access funding during the winter.
– Elsewhere in the UK
The Treasury has announced Â£ 150 million for devolved administrations.
The funding, which will be issued in connection with the Barnett Formula, will include around Â£ 80million for the Scottish government, Â£ 50million for the Welsh government and Â£ 25million for the Northern Ireland executive.
– Existing measures
Mr. Sunak also highlighted a number of existing financial support measures for businesses.
One of them is relief from reduced business rates for retail, hospitality and leisure businesses for the remainder of the year.
There will also be a 50% reduction in business rates for companies in these sectors in fiscal year 2022/23.
However, both of these reliefs will have limited benefits for large operators, with next year’s relief capped at Â£ 110,000 per company.
The Chancellor also highlighted the VAT rate on hospitality, which, at 12.5%, is lower than the 20% rate before the pandemic, although it fell from 5% in October.
Pub owners have also said that VAT support has only a limited benefit when revenue is sharply reduced, and no benefit when closings take place.