UK offers extra $6.2 billion to firms soften recession, survive new lockdown
London, Jan. 5, 2021 (AltAfrica)-UK has offered another £4.6 billion ($6.2 billion) support package for businesses on Tuesday to soften an expected recession caused by a surge in COVID-19 cases that has prompted a third national lockdown.
Businesses in retail, hospitality and leisure will receive new grants to help them keep afloat until spring, Chancellor Rishi Sunak has said.
The grants will be worth up to £9,000 per property, the Treasury says.
The help is in addition to UK business rates relief and the furlough scheme which has been extended until the end of April.
Separately, £594m will be made available to affected firms outside these sectors, Mr Sunak said.
This money will be made available by local authorities.
“The additional support announced by the chancellor will be welcomed by many businesses struggling for survival,” said Mel Stride, chair of parliament’s Treasury Committee, which scrutinises the finance department’s work.
“The chancellor must not forget those who have fallen through the gaps around previous support packages,” he added.
Newly self-employed people were often missing out, his committee has found.
Mr Sunak said the new support would “help businesses to get through the months ahead – and crucially it will help sustain jobs, so workers can be ready to return when they are able to reopen”.
Businesses such as cafes, restaurants, leisure centres and shops that do not sell essentials have been particularly hard hit by coronavirus lockdown measures as people are told to stay at home.
All non-essential shops, leisure and entertainment venues are now closed, with pubs and restaurants allowed to offer takeaway food only.
Indoor and outdoor sport is also cancelled except for elite competitions.
Prime Minister Boris Johnson announced the lockdown on Monday, saying a highly contagious coronavirus variant risked overwhelming the health service within 21 days.
Most people must work from home and schools have closed for almost all pupils. Hospitality venues must stay shut, as well as non-essential shops.
Britain’s economy now looks likely to tip back into recession – shrinking in the final quarter of 2020 and the first quarter of 2021 – after suffering a record 25% fall in output in the first two months of lockdown in 2020.