The Chancellor Mr. Rishi Sunak has delivered his latest economic statement.
In his announcement, The Chancellor began by acknowledging the frustration of those living in Tier 3 local lockdown areas. He then reiterated that the treasury have a plan to save jobs and backed the Prime Minister’s local lockdowns. Sunak announced the further steps he will be taking.
Business Grant Scheme
The first of which is the new Business Grant Scheme for businesses impacted by any of the tier systems, even if they are not forced to close by law.
Businesses in the hospitality, accommodation and leisure sectors will be eligible for cash grants of up-to £2,100 per month for those not forced to close and £3000 for those businesses that are forced to close. Grants can be backdated to August for areas that have been under local lockdowns.
Job Support Scheme
The next step announced by the Chancellor is the update to the Job Support Scheme.
For those businesses in Tier 3 areas the Government will cover 2/3 of salaries where employees cannot work for a period of one week or more.
The employers contribution for hours not worked in Tier 2 areas will also decrease from 33% to 5%.
The changes will mean that employers will have to pay for a minimum of 20% of usual hours worked and 5% of hours that are not worked, with the Government now funding 62% of wages for hours not worked.
There will also be a reduction to the number of hours an employee is required to work to enter the scheme. The reduction will take the total amount of usual hours down from 33% to 20%.
The scheme will remain open to all small businesses and any larger businesses that can evidence the impact on their revenues.
The third and final new update from today’s announcement was regarding self-employment.
The generosity of the self-employment scheme has doubled from 20% to 40% of profits, with a maximum grant of £3,750 being offered over a three-month period.
In a further announcement from the treasury, yesterday Mr Sunak announced that a one-year spending review will be undertaken in order to help prioritise the response to the ongoing coronavirus pandemic.
The review will help setting departmental resources and capital budgets for 2021-22.
The Spending Review will build on support and focus on three areas:
- Providing departments with the certainty they need to tackle Covid-19 and deliver a plan for jobs to support employment.
- Giving vital public services enhanced support to continue to fight against the virus alongside delivering first class frontline services.
- Investing in infrastructure to deliver ambitious plans to unite and level up the country, drive economic recovery and Build Back Better.
A precise date for the review is yet to be confirmed but it is expected in the last weeks of November.