Companies struggling in the Tier 2 coronavirus alert areas which have been hit by the restrictions will be eligible for cash grants of up to £2,100 a month, Chancellor Rishi Sunak has announced.
The moves, which are expected to primarily benefit the hospitality, accommodation and leisure sectors, follow significant pressure on the Government from unions and business groups.
Mr Sunak also announced an extension to the Job Support Scheme, and to help available to the self-employed.
Large areas of London and the South East, plus parts of the North East and the Midlands, are under the Tier 2 restrictions where pubs and restaurants have found it difficult to trade profitably but where the additional support for Tier 3 areas is not available.
Rishi Sunak said a tiered approach was the right way to control the spread of the virus, but that "it is clear that even businesses who can stay open are facing profound economic uncertainty”.
Informing the Commons that he had spoken to hospitality representatives on Thursday morning, the Chancellor said: “Their message was clear – the impact of the health restrictions on their businesses is worse than they hoped.”
Mr Sunak added: “So I am taking three further steps today.”
Mr Sunak said the Government would offer grants through local authorities that would give hospitality, accommodation and leisure businesses grants of at least £2,100 a month, backdated to August.
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He also reduced the number of hours worked for the Job Support Scheme and the contribution employers will need to make.
And he said he was doubling the amount of support available to the self-employed.
He added: “To protect jobs, we are making the Jobs Support Scheme more generous for employers. If businesses are legally required to close as we’ve already outlined the Government will cover the full cost of employers paying two-thirds of people’s salary where they can’t work for a week or more.
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“For businesses who can open it is now clear the impact of restrictions on them particularly in the hospitality sector is more significant than they had hoped.
“So, I am making two changes to the short-time work scheme to make it easier for those businesses to keep staff on rather than make them redundant.
“First, under the original scheme employees had to work for 33% of their normal hours. Now we will ask them to work only 20% of those hours.
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“Second, the employer contribution for the hours not worked will not be 33% as originally planned, or even 20% as it is in the October furlough scheme, it will reduce to 5% and the scheme will apply to eligible businesses in all alert levels.”
The next round of the self-employed income support will increase from 20% to 40% of people’s incomes, increasing the maximum grant to £3,750.
Labour’s Anneliese Dodds told the Commons: “This is becoming like a long-running television show – the Winter Economy Plan, series three.
“But you know the twist is it didn’t last the winter, it didn’t do enough to help the economy and it wasn’t a plan.
“We’ve got to get ahead of this crisis instead of always running to keep up.”
Ms Dodds repeated Labour’s desire for a national circuit-breaker lockdown.
The package has been welcomed by British Chambers of Commerce director general Adam Marshall.
He said: "This is a very significant improvement in the support available to businesses struggling with the impact of increasing restrictions across the 海角视频.
“Chambers have been campaigning for greater support for businesses experiencing big falls in demand as a result of new restrictions, and a number of the steps announced today, including the lowering of employer contributions and the number of hours worked needed to qualify for the scheme, respond directly to our calls.
"Backdated grants for hospitality firms in tier two and enhanced grants for the self-employed will go some way to alleviating pressure on many of those who have been particularly vulnerable to the economic impact of the pandemic.”
Federation of Small Businesses chair Mike Cherry said: “At a time of immense struggle for many small businesses, these interventions will help to protect jobs, businesses and livelihoods. The Chancellor has shown a willingness to be flexible and adapt interventions as the second wave of the virus escalates.
“With the furlough scheme coming to an end in just a few days, the expansion of the Job Support Scheme will help to reduce the burden on small businesses and give them a shot at surviving this crisis while offering a critical lifeline to millions of jobs. This will be helpful for small firms in all tiers of restrictions and businesses in all sectors.
“But it isn’t just businesses who are forced to close, who need support, these funds must be made available to those in the supply chains of affected firms as well as those without premises, especially those in the hospitality sector.
“Business grants, including those being applied retrospectively to those in Tier 3 areas will be a welcome relief to thousands of businesses who have been left wondering how they’ll survive in the weeks and months ahead."