21 December 2021
£1 billion in support for businesses most impacted by Omicron across the UK

Additional support will be available for businesses who have been impacted by the Omicron variant, the Chancellor, Rishi Sunak announced today (21 December).

  • Businesses in the hospitality and leisure sectors in England will be eligible for one-off grants of up to £6,000 per premises, plus more than £100 million discretionary funding will be made available for local authorities to support other businesses
  • Government will also cover the cost of Statutory Sick Pay for Covid-related absences for small and medium-sized employers across the UK
  • £30 million further funding will be made available through the Culture Recovery Fund, enabling more cultural organisations in England to apply for support during the winter

Recognising that the rise of the Omicron variant means some businesses are likely to struggle over the coming weeks, the government is providing one-off grants of up to £6,000 per premises for businesses in the hospitality and leisure sectors in England.

At what is often their most profitable time of year, many pubs and restaurants have seen cancellations and reduced footfall as people have responded to the rise in cases ahead of Christmas, with Hospitality UK reporting that many businesses have lost 40-60% of their December trade, often their most profitable month.

Around 200,000 businesses will be eligible for business grants which will be administered by local authorities and will be available in the coming weeks.

Given the uncertain situation faced by businesses, the government has chosen to provide generous grants, which 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.

The effectiveness of government policies to support the economy through the pandemic and the success of businesses in learning to adapt means the economy is in a different place now than it was at the start of the crisis.

Many businesses have more cash in the bank than they did at the start of the pandemic and net cash deposits for all hospitality businesses have risen by £7 billion (40%), while small and medium-sized businesses in the hospitality sector have seen their cash deposits rise by £2 billion (79%).

Fewer businesses have become insolvent, with insolvencies running 25% lower than pre-pandemic in hospitality, and vacancies are 50% above pre-pandemic levels.

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.