£1bn COVID-19 support package
As least it’s something… for now!
The Chancellor’s Omicron support package for the hospitality sector is worth £1bn, enough for Rishi Sunak to claim he’s acted on the cries of distress from pubs, restaurants, leisure businesses and some other small businesses.
The package is made up as follows:
- Businesses in the hospitality and leisure sectors in England will be eligible for one-off grants of up to £6,000 per premises.
- More than £100 million discretionary funding will be made available for local authorities to support other businesses.
- Government will also cover the cost of Statutory Sick Pay for Covid-related absences for small and medium-sized employers across the UK.
- £30 million further funding will be made available through the Culture Recovery Fund, enabling more cultural organisations in England to apply for support during the winter
- Lobby group’s had been calling for an extension to business rates relief and a lower VAT rate, but these calls have not been heard.
It is hard, though, to escape the sense that the measures could quickly be overtaken by events. This is a limited package designed merely to catch up with the current “pseudo lockdown” environment, meaning consumers’ decisions to tone down their pre-Christmas activities. It would not be sufficient to cope with a ramping up of restrictions that are unfortunately expected before the end of the year.
This new package of support comes on top of existing support for business in the form of the Recovery Loan Scheme which allows companies affected by the pandemic to potentially borrow, when they might not otherwise have been able to. The government guarantee to lenders on the loan is shortly (1st January 2022) move down to 70% from it’s starting point of 80%, and the maximum loan amount reduces down to £2M from £10M
One hopes the Treasury knows that if restrictions are to be brought that further financial support will be needed as the current financial assistance in place, does nothing for employees who would be at risk of losing their jobs in a “proper” lockdown.
The open question is what support might be needed if heavier restrictions are introduced after Christmas. Some version of the furlough scheme would still seem essential. The Chancellor has done enough for now; it cannot be the last word on the matter.
Find out more
If you require support our Banking & Finance team has many years of experience helping businesses who need to raise finance while navigating, what can be, a complex banking and finance market. We are not tied to a specific funder and adopt a whole of market approach so you will always be offered a range of bespoke funding solutions.
To discuss how we can help your business, please complete our online enquiry form and a member of the team will be in touch.
