“Today we go further” was the message of Chancellor Rishi Sunak in response to recent calls for extra help for regions entering local lockdowns. Currently, more than half of England’s population lives in areas in Tier 2 or higher. In his speech in Parliament Sunak addressed the ‘Tier 2’ dilemma. Until today, Tier 2 represented as Stephen Bush puts it “the worst of both worlds” where “businesses … face significant restrictions on how they operate, but [receive] no economic support.” New measures will ensure that some businesses will no longer be paradoxically better off under Tier 3.
The new measures announced today also included expanded funding for the self-employed, businesses forced to close due to local restrictions and the Job Support Scheme. This policy update will break down what the measures mean for entrepreneurs.
In this Policy Update, we explain the new policies set out in the Winter Economic Plan Statement, including the new Job Support Scheme.
Local Restrictions Support Grant
Hospitality businesses in areas at a high alert level (Tier 2) will now be able to benefit from Local Restrictions Support Grants. This measure is targeted at businesses who while not forced to close, experience falls in trading volume as a result of restrictions. Local authorities will administer the grants and will receive funding based on the number of hospitality, hotel, B&B, and leisure businesses in their area. There will also be additional funding for businesses that don’t fit neatly into a single category.
The grants will be up to £2,100 a month with the level of support varying based on the rateable value of the business’s premises, so:
For properties with an RV of £15k or under, grants of £934 per month
For properties with an RV of £15k or under, grants of £934 per month
For properties with an RV of between £15k-£51k, grants of £1,400 per month
Eligibility criteria for the grants will be set by local authorities so if your business needs to access the scheme you should contact them directly. Businesses that have been living under Tier 2-equivalent restrictions for several months already will be able to backdate the grants to when the restrictions began.
By contrast if your business is legally forced to close as under very high alert (Tier 3) then you are able to claim £3,000 a month. This is an improvement from up to £1,500 per three weeks. They are also eligible to receive the payment sooner, after only two weeks of closure, rather than three.
Job Support Scheme
The Job Support Scheme has been expanded. When it was announced the scheme had employers paying a third of their employees’ wages for hours not worked, and required employers to be working 33% of their normal hours. The scheme now reduces the employee contribution to just 5% and reduces the minimum hours requirement to 20%.
Self Employment Income Support Scheme
The two forthcoming self-employed grants will be increased from 20% to 40% of profits, meaning the maximum grant will increase from £1,875 to £3,750.
We will keep you updated as more information comes out about these schemes through these Policy Updates and our Friday Newsletter.
Photo credit: Andrew Parsons/No 10 Downing Street