Chancellor Rishi Sunak is to unveil a new financial support scheme, with up to £18,000 available for hospitality businesses, as part of the Budget announcement on Wednesday.
‘Restart grants’ will aim to help businesses in the hospitality and retail sectors reopen as England eases its lockdown, as Sunak said the £5 billion fund scheme would give businesses the ‘support to get them back on their feet’.
Speaking to the BBC’s Marr show, Sunak said offering the grant was “the right thing to do now”, and noted that it had been “incredibly difficult year” for hospitality and the high street sectors.
He also promised there would be “more to come” on Wednesday’s Budget announcement.
Nearly 700,000 hotels, shops, restaurants, hair salons, gyms and other businesses in England, will be eligible for the grants, to be distributed directly to firms by local authorities from April. It will replace the current monthly grant system.
Kate Nicholls, chief executive at UKHospitality, welcomed the grants but stressed the ‘urgent need’ for the grants to reach all hospitality business as quickly as possible.
Previous grants have been delayed by bureaucratic processes and businesses reported that only 37% of grants announced in January had been paid out a month later. This is far too long for businesses struggling to survive.
Nicholls said: “It is absolutely critical that the grant funding is put into the hands of hospitality business owners as quickly as possible. Businesses are crying out for the cash now so there can be no further delays which might make it too late for some.
“The government must also clarify once and for all that these grants are not subject to EU State Aid rules and that grants can flow to all businesses that so desperately need them.
“While this is a positive step it needs to be part of a wider package at the Budget that includes an extension to the 5% VAT rate for a full year and a business rates holiday through 2021/22. 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.”
The grants will be allocated based on the value of a property:
– For properties with a rateable value of £15,000 or under: £8,000
– For properties with a rateable value between £15,000 and £51,000: £12,000
– For properties with a rateable value of £51,000 or over: £18,000