Chancellor, Rishi Sunak yesterday announced an additional £1 billion support scheme for the hospitality and leisure sectors, as a result of growing concern of the impact of the Omicron variant on businesses.
With reports of further restrictions being introduced over the next few weeks, the Government have responded with their support plans due to hospitality companies likely to be hit hardest at what would normally be their busiest time of year.
The Chancellor said:
“I know the current situation is very difficult especially for those in the hospitality industry so today we are announcing three new measures to help people and businesses”.
1) £6,000 grants available
Eligible hospitality businesses will be able to claim one-off cash grants of up to £6,000.
Some businesses have reported a 40-60% loss of their December trade due to reduced footfall and cancellations as the government advises people to prioritise socialising and work from home.
Around 200,000 UK businesses will be eligible for the grants which will be available in the coming weeks through local authorities.
The Chancellor commented that the grants are equivalent to the monthly cash grants provided to hospitality businesses when they were fully closed earlier this year, despite businesses now being still able to trade.
2) £30 million top-up funding through the Cultural Recovery Fund
In order to continue supporting the cultural sector, £30 million further funding will be made available up to March 2022 through the Culture Recovery Fund. This supports organisations like museums, orchestras and theatres.
This fund was originally announced in July 2020 to help cultural organisations to survive and when possible, reopen – it has so far helped around 5,000 businesses. The additional funding adds to the almost £2 billion already provided by the Government.
3) Reintroduction of Statutory Sick Pay Rebate Scheme (SSPRS)
The Government will cover the cost of Statutory Sick Pay for Covid-related illness for small and medium sized businesses with fewer than 250 employees.
As the number of Covid-19 cases are rising, more people are taking time off work. The SSPRS will reimburse employers for up to 2 weeks per employee. Organisations are eligible for this from yesterday and can make claims retrospectively from mid-January.
These additional measures will reinforce the existing package of business support, including:
| • business rates relief meaning that the majority of businesses in the hospitality and leisure sectors will see a 75% reduction in their business rates bill across the entire financial year and a new 50% capped business rates relief next financial year; |
| • a 12.5% reduced rate of VAT for hospitality and tourism to support the cash flow and viability of around 150,000 businesses and protect over 2.4 million jobs, until the end of March; |
| • the £1.5 billion Covid Additional Relief Fund for businesses that have not previously had business rates support; |
| • businesses will be protected from eviction if they are behind on rent on their premises, thanks to the moratorium in place until March 2022; |
| • access to finance for SMEs through the Recovery Loan Scheme to June; and |
| • Bounce Back Loan repayment flexibility, with borrowers having the option to take a 6 month repayment holiday, three 6 month interest only periods or extend their loan to 10 years, which almost halves the monthly payment. |
| • support for the aviation and travel sectors, including over £12 billion since the beginning of the pandemic, and the Airport and Ground Operations Support Scheme (AGOSS) until the end of March 2022. |
| • HMRC stand ready to support any business impacted by the coronavirus pandemic through its Time to Pay arrangement, and the Chancellor has asked them to offer businesses in the hospitality and leisure sectors in particular the option of a short delay, and payment in instalments, on a case by case basis, as part of this. |
Source: www.gov.uk
Following yesterday’s announcements, the questions everyone will want to know is what further restrictions will come into place, when we will find out and crucially, what further support measures will be available for our businesses. We will provide updates as and when we have them.
How can we help?
If you would like help navigating the support you can access, contact your usual relationship practitioner, email intouch@haroldsharp.co.uk or call us on 0161 905 1616.