Covid: Sunak unveils raft of increased job support with Tier 2 businesses set to benefit

  • Video report by ITV News Political Correspondent Paul Brand

Hospitality, leisure and accommodation businesses operating under Tier 2 restrictions are to receive cash grants from the government as part of expanded financial support to help Britons "through the difficult winter months ahead".

Chancellor Rishi Sunak announced that firms in 'high' coronavirus alert level areas will be able to apply for grants worth up to £2,100 a month.

Tier 2 business grants will be available retrospectively for areas which have already been under the restrictions.

The Jobs Support Scheme is also being made "simpler and more generous", with staff only needing to work one day a week to be eligible and the contribution employers make is being "significantly" reduced.

The scheme - which will come into effect on November 1 - has been altered, meaning businesses will only need to pay 5% of unworked hours, rather than 33%.

It means if someone was being paid £587 for their unworked hours, the government would be contributing £543 and their employer only £44.

ITV News Political Correspondent Paul Brand has more:

And Self-Employment Income Support Scheme is being doubled from 20 per cent to 40 per cent, meaning the maximum grant will increase from £1,875 to £3,750, over three months.

The increased Self-Employment Income Support Scheme is estimated to provide a potential further £3.1bn in support. A further three month grant will be available covering February to April.

The Treasury estimates the Tier 2 business grants could benefit around 150,000 businesses in England, including hotels, restaurants, B&Bs and many more who aren’t legally required to close but have been adversely affected by local restrictions nonetheless.

The grants will come on top of higher levels of additional business support for Local Authorities moving into Tier 3.

Mr Sunak said: "I've always said that we must be ready to adapt our financial support as the situation evolves, and that is what we are doing today.

"These changes mean that our support will reach many more people and protect many more jobs.

"I know that the introduction of further restrictions has left many people worried for themselves, their families and communities.

"I hope the government's stepped-up support can be part of the country pulling together in the coming months."

Explaining why he has been forced to introduce extra measures just weeks after setting out his Winter Economy Plan, Mr Sunak told MPs that even businesses which can stay open are facing "profound economic uncertainty".

Chancellor Rishi Sunak explains the latest support measures:

However, there was anger from Labour over the timing of Mr Sunak's announcement, with Shadow Chancellor Anneliese Dodds branding it a "last-minute move".

She suggested the chancellor has only "caught up and listened to the anxiety of workers and businesses when it looks like [Tier 2] restrictions will be affecting London and the West Midlands".

Ms Dodds argued that that regions like the North have been under restrictions for weeks and seen "their businesses slip through their fingers".

She added that the Chancellor's previous business support plans had been a "patchwork of poor ideas rushed out at the last minute".

Covid tiers: - What are the differences between each alert level?

  • Medium (Tier 1) - Rule of six applies indoors and outdoors. Pubs and restaurants close at 10pm.

  • High (Tier 2) - Households must not mix indoors in any setting including pubs and restaurants. Rule of six applies outdoors

  • Very high (Tier 3) - Households must not mix indoors, or in private gardens. Rule of six applies in outdoor spaces including parks. Pubs and bars which don't serve meals will be closed

"The deadline for large scale redundancies came and went" before the chancellor announced the job support scheme in September, Dodds said.

Labour's concerns were echoed by some local leaders in Greater Manchester, angry that extra support had not come sooner, given that they had been under tougher restrictions for months.

Greater Manchester Mayor Andy Burnham said: "Why on Earth was this not put on the table on Tuesday to reach an agreement with us?

"I said directly to the PM that a deal was there to be done if it took into account the effects on GM businesses of three months in Tier 2."

Watch the chancellor's statement in full