Government unveils new covid-19 financial support package for tier 2 businesses
Chancellor Rishi Sunak has revealed a new raft of financial support for businesses in tier two “high” risk regions of England that have seen their income drop due to the coronavirus restrictions.
Companies based in tier two areas will be eligible for cash grants of up to £2,100 per month in a package that has been designed to support the hospitality, leaisure and hotel sectors, among others.
The support was announced on October 22, as Slough, Stoke-on-Trent and Coventry became the latest areas set to be moved into tier 2, effective from Saturday, October 24.
The updates to financial support include:
Revised Job Support Scheme (JSS)
Revisions to the Job Support Scheme, which was announced in September and comes into force on November 1, mean employers will pay a maximum of 5% of employees’ wages for hours not worked.
The minimum hours requirement has also been reduced from 33% to 20%.
The government will now fund 62% of the wages for hours not worked. This means the maximum payment has more than doubled, to £1,541.75 a month.
Changes to the Self-employed Grant
The potential grant amount for self-employed workers has been raised from 20% of profits (up to a maximum of £1,875) to 40% (to a max of £3,750) for each three-month period.
Additional funding for Business Grants
The Government will provide local authorities with additional funding to support businesses in tier 2 areas of England that have been severely impacted by the restrictions.
Cash grants of up to £2,100 per month will be given primarily to businesses in the hospitality, accommodation and leisure sector and will be available retrospectively for areas that have already been subject to restrictions.
Businesses in tier 3 “very high” alert areas will be able to access greater support via individual business support packages given by Government to each local authority as it moves into tier 3.
Chancellor Rishi Sunak said: “I’ve always said that we must be ready to adapt our financial support as the situation evolves, and that is what we are doing today. These changes mean that our support will reach many more people and protect many more jobs.
“I know that the introduction of further restrictions has left many people worried for themselves, their families and communities. I hope the government’s stepped-up support can be part of the country pulling together in the coming months.”
The National Hair & Beauty Federation welcomed the announcement. The association's new chief executive, Richard Lambert, said “We commend the Government for their latest announcement, responding to the feedback from ourselves and others that operational businesses are seeing desperately low client numbers because of the current situation and are in urgent need of help.
He added: "What we now need is to ensure that adequate support is getting to all business, regardless of their alert level or tier and that it is coming through quickly. We will be continuing to call on the government to address upcoming pinch points for businesses such as the end of the moratorium on eviction protection at the end of December and the 100% business rates relief which run until the end of March.”