UK Offers Extra £4.6 Billion to Help Firms Through New Lockdown

UK Offers Extra £4.6 Billion to Help Firms Through New Lockdown
Britain's Chancellor of the Exchequer Rishi Sunak leaves Downing Street, in London, on Nov. 25, 2020. (Simon Dawson/Reuters)
Alexander Zhang

The British government announced on Tuesday that it’s offering a £4.6 billion ($6.2 billion) support package for businesses that have been hit hard by new CCP virus lockdown measures.

Chancellor of the Exchequer Rishi Sunak said the government is offering one-off top-up grants for retail, hospitality, and leisure businesses worth up to £9,000 ($12,225) per property to help businesses through the new lockdown measures intended to stem the spread of a new CCP (Chinese Communist Party) virus variant.
This follows Prime Minister Boris Johnson’s announcement on Monday evening that England was to be put into a new national lockdown from Tuesday, ditching the local tiered system, which he said had failed to hold back a surge of the new variant of the CCP virus.
Scotland’s First Minister Nicola Sturgeon also announced a national lockdown starting from Tuesday.

Under the new lockdown, people are instructed to work from home unless it is impossible for them to do so. All hospitality venues must remain closed as well as non-essential shops. Organised sports, both indoors and outdoors, are cancelled except for elite competitions.

Johnson laid the blame for the failure of previous measures on the emergence of a new CCP virus variant, which he said has a 50 to 70 percent faster rate of transmission.

Sunak said the new COVID-19 variant “presents us all with a huge challenge.”

“Throughout the pandemic we’ve taken swift action to protect lives and livelihoods and today we’re announcing a further cash injection to support businesses and jobs until the spring,” he said in a statement.

“This will help businesses to get through the months ahead—and crucially it will help sustain jobs, so workers can be ready to return when they are able to reopen.”

The government is also providing local authorities and devolved administrations a further £594 million ($807 million) to support businesses that are not eligible for the grants but might be affected by the new lockdown measures.

The UK government has spent hundreds of billions of pounds on its response to the CCP virus pandemic, including the furlough scheme, support for the self-employed, tax cuts, and extra funding for schools and local councils.

Sunak said in November that the UK was forecast to borrow a total of £394 billion ($527 billion) this year, the highest recorded level of borrowing in peacetime.

He said at the time that the situation was “clearly unsustainable over the medium term,” adding that “we have a responsibility, once the economy recovers, to return to a sustainable fiscal position.”

Simon Veazey and Reuters contributed to this report.