RISHI Sunak has announced billions of pounds of extra help for firms and workers after "profound economic uncertainty."
The package includes making the Job Support Scheme, which replaces the current furlough system, more generous.
The Job Support Scheme – the plan designed to replace the furlough system from November 1 – will be made more generous across the country.
Instead of only being open to people in “viable” jobs working a third of their normal hours, it will now cover employees doing just 20% of their usual work.
The amount that employers are required to pay to top up their wages has also been reduced to just 5% of unworked hours, down from 33%.
Extra help for the self-employed will see the amount covered by grants increase from 20% of profits to 40%, meaning the maximum payout will increase from £1,875 to £3,750.
This will amount to a potential further £3.1 billion of support to the self-employed through November to January, with a further grant to follow covering February to April.
The Treasury estimates the enhanced Job Support Scheme will cost £1 billion a month for every two million people on it.
Mr Sunak said: “I’ve always said that we must be ready to adapt our financial support as the situation evolves, and that is what we are doing today.
“These changes mean that our support will reach many more people and protect many more jobs.
“I know that the introduction of further restrictions has left many people worried for themselves, their families and communities.
“I hope the Government’s stepped-up support can be part of the country pulling together in the coming months.”
The Chancellor said hospitality industry chiefs have given a clear message that “the impact of the health restrictions on their businesses is worse than they hoped”.
Mr Sunak’s decision to make the business grants retrospective came after criticism from northern leaders about why extra support was only being announced after London moved into Tier 2.
However, Shadow chancellor Anneliese Dodds branded Mr Sunak’s announcements “a patchwork of poor ideas rushed out at the last minute”.
But Confederation of British Industry director-general Dame Carolyn Fairbairn said: “This is a big step towards a more standardised approach of support for areas going into Tiers 2 and 3 and those businesses that face tough times who operate within them.”
She added: “Looking beyond the immediate fire-fighting, the Chancellor will need to look at ways of stimulating business investment and innovation which will be key to how the economy thrives once again.”
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