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The UK has been forced to shut down by law due to a coronavirus ban. Employees working for companies are paid two-thirds of their wages by the government.
The plan will start on November 1 and run for six months, a Treasury source says it could cost millions of pounds a month.
Chancellor Ishii Sunke said he would maintain safety for staff and business.
The ban amendment, which will see pubs and rest restaurants rent off in the most affected areas, is expected on Monday.
Shadow Chancellor Nell Nelis Ddds said Mr Sunak’s “delay in delivering support has caused unnecessary anxiety and job losses.”
Regional leaders have called for more help for struggling companies.
The scheme will only apply to businesses that are asked to close – rather than choose to close due to the effect of the Covid ban.
Support will be reviewed in January. Businesses that are asked to close until November can continue to use the furlough scheme.
Grants will be paid up to a maximum of £ 2,100 per employee per month and the Treasury said they will protect jobs and enable businesses to open faster once restrictions are lifted.
Mr Sunak acknowledged that his announcement was “in advance of what could be a difficult winter”.
In addition, for businesses forced to close in England, the Chancellor announced an increase in business grants – paid up to £ 3,000 per fortnight every month.
The Treasury says it will receive more funding, allowing the corrupt administration in Scotland, Wales and Northern Ireland to take similar action if they choose.
The CBI’s business lobby group said “they should give this tweak to the most affected people and hire more people.”
CBI boss Dame Caroline Fairbain added, “But many companies, including pubs and restaurateur rentals, will be disappointed if they have to close their doors again after doing so much to protect customers and employees.”
Mike Cherry, boss of the Federation of Small Businesses, said the extra help for closed businesses would be “welcomed by thousands of small businesses”.
‘Range of options’
The chancellor described Friday’s announcement as “a very different plan from what we had, this is not a universal approach, this is an extension of the job support scheme especially for those who will be formally or legally asked to close businesses.”
Asked whether the announcement indicated that the government would ask businesses such as the hospitality business to close, Mr Sunak said: “The increase in cases and hospital admissions in some parts of the country is worrisome.
“It is true that the government is considering different options … but it is also true that they are engaging with local leaders.
“The same thing is happening this afternoon and over the weekend so that those conversations can take place and collectively we can decide on the right response.
An indication of how quickly the coronavirus situation has escalated is that the Chancellor has to return to the policy he thought he announced the winter economic plan two weeks ago.
The government insists that this furlough scheme will not run again, which is due to end later this month, but in all important matters this furlough is mark two.
The crucial thing is that if small legal employers are legally forced to close they will not have to contribute anything to the wages of their workers.
Large businesses will have to contribute about 5% of employee costs in the form of national insurance and pension contributions.
It is more generous than the furlough scheme ending and more generous than the job support scheme Mr. Sunak announced 10 days ago, requiring employers to pay 55% of the salary of active workers.
The reason is simple – the measures that apply to industries that are allowed to remain open. This new plan only applies to businesses that do not.
Other questions are not easy – who will qualify? What about industries that have never been allowed to reopen since March?
Will it be enforced by postcode? Would you walk 10 minutes down the road to an open pub but pay 55% of the staff wages when less than half full?
And perhaps most importantly how strong is the evidence for the expected “beneficiaries” of this scheme – the hospitality industry – for which this policy is based and we can look at it in detail?
The Job Support Scheme, which will replace the Furlow Scheme from November 1, will give eligible workers three-quarters of their normal pay for six months.
To be eligible, employees must be in a “competent job” where they can work for at least a third of their normal hours.
For non-working hours, the government and the employer will pay one third of each outstanding salary. This meant that the employee received at least 77% of their salary.
Image copyright pyrite
Reuters
Under the new measures, pubs and rest restaurants can be closed in the worst affected areas
A tiered system of measures for England is announced by Monday, in an effort to change the patchwork of existing rules across the country, in an effort to curb rising infection rates.
Under the new system different parts of the country will be placed in different categories – although ministers are still discussing specific details.
Pubs and restaurants could be closed in the worst-affected areas, while an overnight stay is being considered.
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