Sunak unveils £4.6bn in new business funding as third lockdown begins

Chancellor Rishi Sunak has announced that businesses in the retail, hospitality and leisure sectors will be eligible for grants of up to £9,000 as part of a £4.6 billion package to keep businesses afloat during the third national lockdown.

The latest lockdown, announced by the Prime Minister last night, will force non-essential businesses to close until at least the middle of February, although Cabinet Office minister Michael Gove has since conceded that the lockdown is likely to last until March.

The grants will come in the form of one-off top-up payments, with businesses with a rateable value of up to £15,000 receiving £4,000, businesses with a rateable value between £15,000 and £51,000 receiving £6,000 and businesses with a rateable value of over £51,000 receiving £9,000.

The grants will be provided on a per-property basis and the Chancellor has said that he expects 600,000 business properties to receive the grants. The support is a devolved policy, with £375 million going to the Scottish Government, £227 million to the Welsh Government and £127 million to the Northern Ireland Executive.

Also included in the £4.6 billion package is a £594 million discretionary fund available to other impacted businesses. The new spending package is in addition to the furlough scheme, recently extended until the end of April, and £1.1 billion in further discretionary grant funding for local authorities and Local Restriction Support Grants of up to £3,000 per month.

Chancellor Rishi Sunak said: “The new strain of the virus presents us all with a huge challenge - and whilst the vaccine is being rolled out, we have needed to tighten restrictions further.”

“Throughout the pandemic we’ve taken swift action to protect lives and livelihoods and today we’re announcing a further cash injection to support businesses and jobs until the Spring. This will 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.”

Roger Barker, Director of Policy at the Institute of Directors, commented: “This new grant package is welcome, and will go some way to reassuring the worst affected businesses.”

“We are particularly pleased the Treasury has taken on board our recommendation to increase the discretionary local authority grant fund. This policy has helped to reach those who haven’t been able to access other support. The government should be prepared to top up the fund if necessary.

“The chancellor must remain wary of a spring cliff-edge in business support as the furlough scheme and other support measures unwind.”

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