News Article

Government unveils changes to winter COVID-19 support

23 October 2020

The Government has announced that it will be increasing its winter support schemes to support jobs and help contain the spread of COVID-19.

What are the changes?

  • open businesses which are experiencing considerable difficulty will be given extra help to keep staff on as government significantly increases contribution to wage costs under the Job Support Scheme, and business contributions drop to 5%

  • business grants are expanded to cover businesses in particularly affected sectors in high-alert level areas, helping them stay afloat and protecting jobs

  • grants for the self-employed doubled to 40% of previous earnings
  • In recognition of the challenging times ahead the government has increased support through the existing Job Support and self-employed schemes and expanding business grants to support businesses in high-alert level areas.

    Cheshire West and Chester is currently in a high alert level area so these announcements therefore apply to our borough.

     

    Job Support Scheme (JSS) Open
    Recognising the evolving situation with the pandemic and health restrictions, and the pressures employers are facing this winter, the Government has announced that it will increase the scale of support available to employers through the Job Support Scheme Open. This is above what was initially announced in order to protect more jobs. The minimum hours required for employees to work has dropped from 33% to 20% of their normal hours per month and the employer contribution for non-worked hours has dropped from 33% to 5%.

    The scheme will run for six months from 1 November 2020 and this increased support for employers will be reviewed in the new year. A JSS policy paper is to be published that will give further details on eligibility criteria, conditions and timescales for making claims under the JSS Open and the JSS Closed (is this the previous scheme?).
    What is the scheme?

  • As part of the overall support offered by the Job Support Scheme, the Job Support Scheme Open is designed to protect jobs in businesses who can operate safely but are facing lower demand over the winter months due to Covid-19. The scheme enables these businesses to retain employees on shorter hours, preserving valuable employment matches and protecting incomes.

  • The Government will pay 61.67% of hours not worked up to a cap of £1,541.75 per month, with the employer contributing 5% of non-worked hours up to a cap of £125 per month. These caps are based on a monthly reference salary of £3,125. This will ensure employees earn a minimum of at least 73% of their normal wages, where their usual wages do not exceed the reference salary. The employee will have to work a minimum of 20% of their normal hours.

  • Employers using the Job Support Scheme Open will also be able to claim the Job Retention Bonus if they meet the eligibility criteria.
  • Who is eligible?
    All employers with a UK bank account and UK PAYE schemes can claim the grant. Neither the employer nor the employee needs to have previously used the Coronavirus Job Retention Scheme (CJRS).

     

    Self-employed grant
    Today’s announcement increases the amount of profits covered by the two forthcoming self-employed grants from 20 per cent to 40 per cent, meaning the maximum grant will increase from £1,875 to £3,750. 

     

    Local Restrictions Support Grant (High alert level areas)
    The government also announced additional funding of cash grants of up to £2,100 per month primarily for businesses in the hospitality, accommodation and leisure sector who may be adversely impacted by the restrictions in high-alert level areas. These grants will be available retrospectively for areas who have already been subject to restrictions and come on top of higher levels of additional business support for Local Authorities moving into very high alert level. 

    What is the scheme?
    The government are providing additional funding to allow local authorities to support businesses in high alert level areas which are not legally closed but are severely impacted by the restrictions on socialising. The funding local authorities will receive will be based on the number of hospitality, hotel, B&B, and leisure businesses in their area, and will assume that these businesses receive grants equivalent to 70% of the grants for which legally closed businesses are eligible.

    This would be equivalent to:

  • For properties with an RV of £15k or under, grants of £934 per month

  • For properties with an RV of between £15k-£51k, grants of £1,400 per month

  • For properties with an RV of £51k, grants of £2,100 per month
  • It will be up to Local Authorities to determine what precise funding to allocate to each business and the above levels are only an approximate guide. Local authorities will also receive a 5% top up amount to these implied grant amounts to cover other businesses that might be affected by the local restrictions, but which may not be in the business rates system. This scheme will initially run until April, with a review point in January.

    Who is eligible?
    Local authorities have the freedom to determine the precise eligibility criteria for these grants in their local areas. The guiding principle for local authorities is to use the funding to support businesses which have not been legally required to close, but which are nonetheless severely impacted by reduced demand caused by high alert level restrictions on socialising.

    How can businesses access the grants?
    Grants will be administered by Local Authorities, and businesses will need to need to apply to their local authority for support. It will be up to local authorities to determine the payment schedule and timings for these grants.

    What can businesses use the grants for?
    Businesses can choose to spend the grants as they wish. We expect that many businesses will use the grants to cover high fixed property-related costs.

    What about areas which have been living under Tier 2-equivalent restrictions for several months?

    Some areas have been subject to restrictions on socialising for several months, before the tiering system was introduced. Funding for these areas will be backdated until the point at which these restrictions began, and further clarity is needed to fully understand.

     

    What is the council doing?
    The council is represented on the national advisory working group and a meeting has been convened by BEIS to review the announcements and influence guidance.

    Information will be put on the council’s web page and disseminated to businesses to enable them to be aware of the schemes announced today.
    The business rate working group is reconvened and has been preparing for a possible new grants scheme in anticipation of today’s announcements.

    Once we have the detailed guidance, we will communicate with key business organisations and prepare the local grants support.

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