As part of measures to soften an expected recession occasioned by a surge in COVID-19 cases, the United Kingdom has offered a 4.6 billion pound ($6.2 billion) support package for businesses across the country.
It indicated that the support fund had become imperative to support businesses that were still yet to recover from the virus’ first outbreak and accompanied lockdowns and the projected second wave which had already prompted a third national lockdown.
UK Finance Minister, Rishi Sunak, has previously announced emergency help for the economy worth 280 billion pounds, including a massive job protection scheme that would run until the end of April.
Approving the support fund on Tuesday, Sunak said that under the additional measures, retail, hospitality, and leisure companies would be able to claim one-off grants worth up to 9,000 pounds.
According to him, the grants will get them through the coming months, costing up to 4 billion pounds in total, along with 600 million pounds of grants for other businesses.
“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,” Sunak said.
UK Prime Minister, Boris Johnson, announced the lockdown on Monday, saying a highly contagious coronavirus variant risked overwhelming the health service within 21 days.
Most people must work from home and schools have closed for almost all pupils. Hospitality venues must stay shut, as well as non-essential shops.
Britain’s economy now looks likely to tip back into recession – shrinking in the final quarter of 2020 and the first quarter of 2021 – after suffering a record 25% fall in output in the first two months of lockdown in 2020.
The new downturn is expected to be far smaller, with most businesses now much better adapted to working remotely and construction sites and factories expected to stay open.
But economists at J.P. Morgan still predicted a hefty 2.5% fall in output for the first three months of 2021.