[Updated] The new Covid-19 financial support: what it means for beauty salons

New financial support to help businesses who have faced disruption during the new Omicron variant, was announced by Chancellor Rishi Sunak in December, with further confirmation in January that beauty salons are eligible to apply.

The Chancellor announced the support on December 21. On December 23, additional details were announced for Wales. On December 29, more detail was announced for Scotland. In January, further announcements have shed further light on who is eligible to access the funds.

What new Covid-19 Government financial support is available for beauty salons?

Businesses within the personal care sector are eligible to apply for the following initiatives.

Additional Restrictions Grants

The Government announced in December that £100m in Additional Restrictions Grants, which can be accessed through your local authority in England only. A Government statement said: “Around 200,000 businesses will be eligible for business grants which will be administered by local authorities and will be available in the coming weeks.”

Each local authority has their own application process. Find your local authority here for more information.

An update to the guidance was published in January, confirming that personal care was included within the group of sectors eligible to apply for the grants. The Government update, which can be viewed here said: 

"Local Authorities are encouraged to support businesses from all sectors that may have been severely impacted by restrictions, or by the Omicron variant, including those outside of the business rates system. These may include, but are not limited to: hospitality, accommodation, leisure, personal care, the travel and tourism sector, including group travel, travel agents and tour operators, coach operators, wedding industries, nightclubs, theatres, events industries, wholesalers, English language schools, breweries, freelance and mobile businesses (including caterers, events, hair, beauty and wedding related businesses), gyms, and other businesses that may have not received other grant funding. There is no restriction on the number of grants a business may receive, subject to subsidy limits."

Statutory Sick Pay Rebate Scheme

The Government has also reintroduced the Statutory Sick Pay Rebate Scheme for Covid-related absences that have affected businesses. This scheme is UK wide.

The Sick Pay Rebate is eligible to businesses with fewer than 250 employees. Employers can be reimbursed for the cost of Statutory Sick Pay for up to two weeks per employee. Claims can be made retrospectively from mid-January 2022.

You can use the Government’s guide to find our if your business is eligible for support.

Prime minister Boris Johnson said: “With the surge in Omicron cases, people are rightly exercising more caution as they go about their lives, which is impacting our hospitality, leisure and cultural sectors at what is typically the busiest time of the year.

“That’s why we’re taking immediate action to help with an extra £1 billion in grants to these industries and reintroducing our Statutory Sick Pay Rebate Scheme.

“I urge people across the country to please get boosted now to secure vital protection for yourselves, your loved ones and your communities.”

Chancellor of the Exchequer Rishi Sunak added: “We recognise that the spread of the Omicron variant means businesses in the hospitality and leisure sectors are facing huge uncertainty, at a crucial time.

“So we’re stepping in with £1 billion of support, including a new grant scheme, the reintroduction of the Statutory Sick Pay Rebate Scheme and further funding released through the Culture Recovery Fund.

“Ultimately the best thing we can do to support businesses is to get the virus under control, so I urge everyone to Get Boosted Now.”

What new financial support is available to salons in Scotland, Wales and Northern Ireland? 

As part of the support announced by Rishi Sunak, the devolved administrations will receive around £150 million of funding, comprising around £80 million for the Scottish Government, £50 million for the Welsh Government and £25 million for the Northern Ireland Executive.

On December 23, Welsh Economy Minister Vaughan Gething announced £120m worth of funds available for retail, hospitality, leisure and tourism business affected by the recent change in restrictions to alert level 2.

Salons that pay Non-Domestic Rates could be be entitled to a payment up to £6,000, depending on their rateable value. Businesses will need to re-register their details with their local authority from Janyuary 10 in order to receive their payments. There will also be new discretionary grants of £500 - £2,000 available to support self-employed professionals.

On December 29, Scotland's First Minister Nicola Sturgeon announced how £107 million is being allocated to support businesses impacted by the spread of the Omicron variant, saying: “Up to £28 million will be allocated to taxi and private hire drivers and operators, £19 million will support services such as beauticians and hairdressers, £5 million will be provided for sport, and an additional £3 million for tourism.”

Industry reaction to financial aid

Richard Lambert, chief executive of the NHBF said: “We welcome this additional financial support for our industry and urge salon owners to check as soon as possible if they are eligible for a grant from their Local Authority. For many people this could be the vital help they need to save their salons from the devasting impact of the Omicron Variant.”

Lesley Blair, chair of Babtac, said: "The hair, beauty and holistic services industry was hit hard by the pandemic. According to research, 70% of businesses said they could not be sure their business would survive until the end of the financial year in 2021.”

A December survey of Babtac members found that over 20% are currently seeing a third of all appointments being cancelled, and 40% of salons have lost between 20-50% of their revenue this December.

The survey also showed that nearly 5% have lost between 75-100% of their revenue, which is especially concerning given the fact that the average percentage of overall yearly revenue usually taken by salons in December is nearly 40% of their total earnings. 

The news comes after an NHBF survey showed that 73% of salons are experiencing unprecedented cancellations due to Omicron variant.