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Emergency funds for hospitality firms hit by local lockdowns

Emergency Covid-19 funds for hospitality

Article updated:Friday 9th October 2020

We are here to support you during this unprecedented time and are working hard to ensure that any local lockdowns or closures that your business might face is met with compensation. We are part of the government roundtable discussions for hospitality and will continue to share any updates we receive.

We also fully support the #cancelthecurfew campaign and are working with industry figures and associations in the events industry to to push for support, as well as working to raise the profile of the 1 Industry 1 Voice campaign.

Although the details of grants haven’t been released, we are seeking clarification about this, the issues lie around the lack of time given to local authorities from Government to prepare their communities for new rules and restrictions and we have asked alongside Hospitality leaders for this to stop happening – we all need time to prepare for changes so that we can give you as much support as possible as you are able to make decisions about how to prepare your businesses.

Further lockdowns announced

Pubs and restaurants across central Scotland are to be closed under new measures aimed at tackling a surge in coronavirus cases.

The new rules come into force today (Friday 9th October 2020) at 6pm and will be in place until 25th October.

The news rules will apply to licensed properties across the central belt, including Glasgow and Edinburgh.

Hospitality businesses in other parts of Scotland will still be allowed to open but can only serve alcohol outdoors as part of the new measures; they will also only be allowed to serve food and non-alcoholic drinks between 6am and 6pm.

From 6pm on Friday, all pubs and restaurants in the five areas where cases of infection are rising: Greater Glasgow and Clyde, Lanarkshire, Ayrshire and Arran, Lothian and Forth Valley, will have to close both indoors and outdoors, although takeaways will still be permitted.

For more information on the guidance issues to the hospitality sector in Scotland, click here.

In other news, Nottingham is expected to be the next city to announce local lockdown restrictions after a surge of infection rates in the area. The rise in cases is said to be partly due to an outbreak at the University of Nottingham, with 425 students having tested positive for Covid-19 during the week ending 2nd October.

A local lockdown has been in force in Greater Manchester since the end of July, whilst existing measures for Northumberland, Newcastle, Tyneside, Gateshead, Sunderland and County Durham were tightened from 30th September.

Two-thirds of the population of Wales is also now under additional lockdown measures, including Neath Port Talbot, Torfaen and the Vale of Glamorgan.

Emergency funds for hospitality businesses

It’s been widely reported that restaurants and bars in northern England will be forced to close their doors once more next week in another example of increased localised lockdowns.

According to information from The Times, the government is planning to cover two-thirds of the wages of employees at hospitality businesses forced to shut.

Liverpool City Region has announced the introduction of a £40m emergency fund for hospitality businesses that have suffered a significant loss in trade due to the coronavirus pandemic.

The hospitality sector, which contributes to over 50,000 jobs in the city, has been hit hard by Covid-19 and has faced even further temporary and permanent closures in recent weeks following tighter restrictions being enforced in the region.

As it stands currently, residents of Liverpool City Region are banned from meeting people indoors from other households, including in pubs, bars, restaurants and cafes. The local restrictions are putting further strain on hospitality businesses who were finally welcoming customers back following the nationwide lockdown earlier in the year and could have a devastating effect on many if they don’t receive further government help and support.

The decision by Liverpool City Region to provide further funding to the struggling hospitality sector will be welcomed by many business owners feeling the impact of a long lockdown. Further restrictions predicted to be enforced over the winter Christmas period – typically the busiest time of the year for the industry – will no doubt spark calls for other local councils to follow Liverpool’s lead in providing extra funding.

Currently, tighter coronavirus restrictions are being introduced in the north of England, including Warrington, Hartlepool and Middlesbrough where people must not meet anyone outside their household, or support bubble, in any indoor setting. In Northern Ireland meanwhile, bars and restaurants in Derry City and Strabane will only be able to open for takeaway, delivery and outdoor eating and drinking.

As it stands, the following local authorities have extra restrictions in place:

  • Glasgow
  • Northern Ireland
  • Newcastle
  • Hartlepool
  • Middlesbrough
  • Leeds
  • Manchester
  • Liverpool
  • Birmingham
  • Leicester
  • Cardiff

New grants available for businesses

Further grants have been made available for those businesses forced to shut because of local Covid-19 lockdowns. As part of the new scheme from HM Treasury, affected businesses will be able to claim up to £1,500 per property every three weeks and payments will be triggered by a national decision to close businesses in a high incidence area.

The largest businesses will receive £1,500 every three weeks they are required to close. Smaller businesses that have an annual rent or mortgage bill below £51,000, and pay less business rates will receive £1,000. The funding eligibility criteria will be determined by the local authority in which your business is registered so please contact them for further information.

Business Secretary Alok Sharma said: “No business should be punished for doing the right thing, which is why today’s package will offer additional breathing space for businesses that have had to temporarily close to control the virus.

“Through our wider Plan for Jobs, we will continue to back our innovators and job creators across the country who are playing a critical role as we build back better from the pandemic.”

What help is available for businesses in England, Wales & Scotland?

Currently, businesses caught up in local lockdowns in England are allowed to claim compensation via their local authority.

Local authorities will also receive an additional 5% top up amount of business support funding to enable them to help any other small business affected by local lockdown which may not be on the business rates list.

To find out more, visit the gov.uk website.

The Welsh government also announced a £60m Local Lockdown Fund to support struggling businesses. The funding from the third phase of the Welsh Government’s Economic Resilience Fund (ERF) will see wider support being provided to secure jobs and help businesses develop, as well as additional help for firms affected by local lockdowns.

The fund will be able to provide:

  • Grants of £1,500 will be available to retail, leisure and hospitality businesses with a rateable value of between £12,001 and £51,000 that have seen a material impact on their business as a result of local restrictions.
  • Grants of £1,000 will be available to small businesses with a rateable value of £12,000 or less and who can similarly demonstrate a material impact on their business.
  • 5% of this funding will be made available to local authorities to support businesses materially impacted by local lockdown, but not registered to pay business rates, with discretionary grants of up to £1,500.

The Scottish government is also involved in providing a Business Support Fund for businesses affected by local lockdowns.

The general fund is available to hospitality businesses specified in the local lockdown regulations. It operates as a two-tiered scheme, with a smaller grant of £1,000 for businesses with a Rateable Value (RV) of under £51,000 and a larger grant of £1,500 for those businesses with a RV over £51,000.  

As well as that, Aberdeen Council is inviting applications for the Discretionary Scheme for business premises that have seen a downturn in trade specifically due to restrictions impacting footfall and customer ability to travel to attend appointments or bookings. 

The discretionary scheme is open to any Aberdeen city business which was open through the local lockdown that can demonstrate loss of business as direct result of the restrictions being in place. 

For more information, visit the Aberdeen City website by clicking here.

Payments for people self-isolating in high risk areas

Individuals on low incomes who need to self-isolate and are unable to work from home in areas where Covid-19 cases are high will be entitled to payment from the government.

Payments of up to £182 will be made to people who have tested positive for Covid-19 and members of their household.

Non-household contacts advised to self-isolate through NHS Test and Trace will also be entitled to a payment of up to £182, tailored to the individual length of their isolation period.

It is designed to support people who are unable to work from home while self-isolating, either after testing positive, or after being identified by NHS Test and Trace as living in the same household as – or coming into contact with – someone who has tested positive. It will be available to people currently receiving either Universal Credit or Working Tax Credit.

Further information can be found on the gov.uk website.

What are the three proposed tiers of local lockdown for England?

A leaked document has revealed plans for three tiers of local lockdown measures in England to curb the spread of coronavirus and reduce confusion caused by a patchwork of regional restrictions. The document, dated 30th September is detailed in The Guardian newspaper here.