LONDON — The U.K. government will pay two-thirds of the wages of workers in pubs, restaurants and other businesses legally forced to close their doors because of coronavirus restrictions this winter, Chancellor Rishi Sunak announced Friday.
In a significant revival of the government’s job support strategy, Sunak said that where employees were unable to work for one week or more because government rules had shut their business down, they would continue to receive 66 percent of their salary, paid for by the Treasury.
With the U.K. facing the threat of mass unemployment as government support under the previous furlough scheme comes to an end this month, Sunak said the new plan would provide “reassurance and a safety net for people and businesses in advance of what may be a difficult winter.”
The approach, targeted specifically at businesses legally required to close, will be in addition to the more limited salary support available to all employers set out by the chancellor just two weeks ago and billed as a replacement for the furlough scheme. The new plan appears to acknowledge that huge numbers of hospitality businesses could be forced to close their doors in the coming weeks and months and that targeted support will be needed. It comes ahead of expected new restrictions for much of the north of England as infections rise rapidly.
Pubs, restaurants and cafes that are forced into a collection or takeaway-only model, or which are forced to only serve people outside, will also be eligible for the support. Venues already required to close across the country, such as nightclubs, are also eligible.
The plan will come into effect on November 1 and will be available for six months, with a review of the measures in January. It is a U.K.-wide measure and the Westminster government said it would work with devolved administrations in Scotland, Wales and Northern Ireland to implement it.
Sunak also announced that existing government grants for businesses forced to temporarily close would be made more generous, with up to £3,000 a month now available to businesses, depending on size, to help with costs.
Kate Nicholls, chief executive of the business association UKHospitality, welcomed the shift to a “sector-specific approach” but said the new plan would not address the financial pressures on businesses that were allowed to stay open but which were still operating “well below capacity due to restrictions and consumers avoiding travel.”
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