Rishi Sunak to unveil £5,000,000,000 grant scheme for businesses hit by Covid

Pubs, restaurants, shops and other businesses hit hardest by the pandemic will be boosted by a £5 billion grant scheme to help them reopen as the third national lockdown is eased.

Chancellor Rishi Sunak is set to unveil ‘restart grants’ worth up to £6,000 per premises to help non-essential retailers in his Budget on Wednesday.

Hospitality, hotels, gyms and personal care and leisure firms, could receive up to £18,000 each as they are due to open later under Boris Johnson’s roadmap out of lockdown.

The Treasury has estimated that 230,000 firms will be considered for the higher band, while 450,000 shops will also be able to apply.

Mr Sunak said: ‘Our local businesses have been hit hard by the pandemic which is why we went big and went early with a multibillion-pound package of support.

‘There’s now light at the end of the tunnel and this £5 billion of extra cash grants will ensure our high street can open their doors with optimism.’

The new scheme is for England, but the devolved nations in Scotland, Wales and Northern Ireland will receive an extra £794 million in funding through the Barnett formula. This works out the relative amount of expenditure that should be allocated to each nation.

Local authorities will be given the job of distributing the grants after they receive the funding in April.

The amount for each premises will depend on their rateable value – the rental value of a commercial property that the Government uses to determine taxation and benefits. 

The UKHospitality trade body welcomed the plan, saying many firms are ‘struggling to see how they could survive’, with rules on social distancing set to continue until at least June 21.

Chief executive Kate Nicholls said: ‘Cash reserves have been severely depleted after a year of closure and restrictions and these grants are a very welcome boost, putting the sector in a better place to restart.

‘Businesses are crying out for the cash now so there can be no further delays which might make it too late for some.

However, Ms Nicholls has called for the grants to form part of a wider package that includes an extension to the reduced VAT rate and a business rates holiday.

She said: ‘Without these measures, and full furlough while we re-open, the hospitality sector’s recovery will be stunted along with our ability to start tackling unemployment by creating jobs.’

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