RISHI Sunak is set to give more financial help for areas thrown into Tier 2 lockdown restrictions in a fresh economic update tomorrow.
The Chancellor will give a statement tomorrow as hospitality businesses in areas where households are not allowed to mix are crying out for extra support.
Yesterday Treasury minister Jesse Norman said the current financial package was “evolving” as MPs demanded extra funding.
And Permanent Secretary to the Treasury Tom Scholar said Mr Sunak was looking at a range of measures to help those hardest hit by the new 3-tiered system of lockdown.
When asked about how businesses in Tier 2 were supposed to survive, Mr Norman said: “We are acutely aware of the financial costs on those businesses, as we are of those on businesses that have been forced to close, and that is why we have put in place an evolving and comprehensive programme of support.”
The combination of 10pm curfews and a ban on households mixing indoors mean restaurants and pubs will suffer when their area is placed in the “high” Covid alert level.
But the extra financial support is only available if infection numbers skyrocket and areas are placed in the toughest Tier 3 measures.
People who work in businesses which are forced to shut by the tough measures will get two-third of their wages paid for by the Government in an extension to the existing Job Support Scheme announced this month.
But those in Tier 2 who have seen sales plummet but have not been forced to close, will get the less generous offer of having 22 per cent of their wages payed by the Exchequer.
Greater Manchester has been offered £60million as the city was handed the strictest lockdown rules, and South Yorkshire will get £42million when Tier 3 measures come into force at a minute past midnight on Saturday morning.
London Mayor Sadiq Khan called for a tailored package of support for London, which was plunged into Tier 2 restrictions last week.
In a letter to Boris Johnson before the formal announcement on new measures in London, Mr Khan said: “It is vital London has the resources to engage, explain, encourage and enforce heightened restriction and support compliance.
And he said it was crucial Tier 2 areas are given enough extra financial support to help get through a “difficult winter ahead”.
Senior Conservative Sir Bob Neill, the MP for Bromley and Chislehurst said last week the hospitality sector needed urgent help and warned it would do “very real harm to businesses.”
Cities of London and Westminster MP Nickie Aiken backed up the calls for extra money, saying “many of our businesses are already on their knees, and I urge the Government to consider further support before they disappear for good.”
UKHospitality, the British Institute of Innkeeping and the British Beer & Pub Association begged Mr Sunak for more help.
They said in a joint statement: “Without urgent sector-specific support for our industry, massive business failure is imminent and hundreds of thousands of jobs will be lost around Christmas from a sector that was in growth at the beginning of this year, as well as in the supply chain that supports them.
“While there are any restrictions placed on hospitality and pubs, there must be financial support in place across all tiers of risk.”