The government has today announced one-off grants for businesses in the retail, hospitality and leisure sectors that have been forced to remain closed in the new lockdown.
These grants will be property based and are worth up to £9,000 in cash per property, depending on the rateable value.
The government estimates this will benefit over 600,000 business properties, worth £4billion in total across all nations in the UK.
Business support is a devolved policy and therefore in Wales, Scotland and Northern Ireland it is the responsibility of the devolved administrations, who will each receive extra funding to pay for these grants.
The government’s press release says that the top-ups will be granted to closed businesses as follows:
· £4,000 for businesses with a rateable value of £15,000 or under.
· £6,000 for businesses with a rateable value between £15,000 and £51,000.
· £9,000 for businesses with a rateable value of over £51,000.
Where it says “businesses” with a rateable value, it really means the property from which the business operates.
Businesses do not have to pay the grant money back.
These top-up grants are in addition to the various other business support schemes, which include 100% business rates relief for retail, hospitality and leisure business, and the extension of the furlough scheme until the end of April 2021.
As these are property-based grants, they will not help those involved in the supply chain to those businesses, for example breweries that supply pubs.
Although any financial help is welcome, the consequences of the latest restrictions, with non-essential retail and full hospitality having already been closed for several weeks, will be severe for many businesses, and these top-up grants will not be adequate compensation.
Business groups have said the money will not be enough to save many firms from collapse.
The British Retail Consortium has said the biggest difference the government can make is to extend business rates relief from April for those hardest hit by repeated lockdowns.
For now, we will have to wait until 3 March 2021 to see what further support packages may be included in the Budget, which the director-general of the CBI, Tony Danker, has said will be too late for many businesses.
In early December 2020, the business evictions ban was extended until 31 March 2021.
There hasn’t been any indication yet whether this ban will be extended any further in light of the new lockdown.