FX.co ★ UK allocates £4.6 billion to support businesses

UK finance minister Rishi Sunak offered a new stimulus package on Monday, January 11, after the authorities announced another national lockdown in the country. The government will allocate around £4.6 billion ($6.26 billion) to support local businesses. According to Financial Times, the UK has already provided emergency help for the economy worth £280 billion during the COVID-19 pandemic. In addition, the Treasury will offer a £4 billion grant to 600,000 retail, hospitality, and leisure companies. These firms will be able to claim a one-off payment of £9,000. An additional £594 million will be allocated to help other businesses that suffered from COVID-19 and incurred losses due to lockdown restrictions. At the same time, many business representatives fear that some sectors of the UK economy will deeply contract in spring 2021 when most business supporting schemes will come to an end. They believe that the current measures are not enough to keep hundreds of thousands of companies afloat. Adam Marshall, the Director General of the British Chambers of Commerce, holds the same view. He believes that immediate subsidies are the right step, but it is insufficient for the proper functioning of the economy. According to Adam Marshall, the government needs to set out a long-term support plan that will be effective throughout the whole year. He also stresses that financial help must “cover not just those on the front line of retail, hospitality, and leisure”, but also the companies involved in supply chains. Other business communities that have suffered from the devastating impact of the COVID-19 restrictions are also in need of financial support, the official adds.