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Government pledges to pay 80% of staff wages after enforcing venue lockdown

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The Chancellor of the Exchequer has confirmed government grants will cover 80% of the salary of retained workers – after Prime Minister Boris Johnson officially ordered a lockdown of all hospitality venues.  

Rishi Sunak said the grants will cover up to 80% of the salary of retained workers up to a total of £2,500 a month, though employers can top up salaries further if they choose.

It comes as Boris Johnson told all pubs, bars and cafes to shut along with theatres, clubs, restaurants, leisure centres and gyms.

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There was however no direct mention of hotels, but UKHospitality helped to clarify this in the days following the announcement.

The scheme will be backdated for wages from 1 March and will be open initially for at least three months, with Mr Sunak revealing there will be “no limit on the amount of funding” for the scheme.

“HMRC are working night and day to get the scheme up and running, and we expect the first grants to be paid within weeks. We are aiming to get it done before the end of April,” he said.

However, for those businesses in difficulties now, the Chancellor expanded the previously announced coronavirus business interruption scheme, with its interest-free period extending from six to 12 months. These loans should now be available from Monday (23 March).

Sunak also bolstered business cashflow support through the tax system. The government is deferring the next quarter of VAT payments so that no business will pay any VAT until the end of June.

Companies will have until the end of the year to repay those bills. “That is a direct injection of over £30 billion of cash to businesses, equivalent to 1% of GDP,” the Chancellor said.

He urged to employers to “look to government” before laying workers off.

He also told businesses that VAT was suspended for the next quarter, with nothing due until June and giving until the end of the financial year to repay.

The intervention from the Chancellor is unprecedented in the history of Britain in a move which will see the government, as Mr Sunak put it, to “step in to pay people’s wages.”

All hospitality venues in the UK were told they must close from Friday night to stop the spread of coronavirus.

Mr Johnson also reported that the government would review the situation each month to see if it can relax any of these measures.

His move should hopefully allow many venues to be able to claim on their insurance.

Tags : coronavirushotelslockdownPrime MinisterpubsrestaurantsRishi Sunak
Andrew Seymour

The author Andrew Seymour

8 Comments

  1. We have been told we aren’t going to get 80% of our wages until end of April. So how am I meant to pay me rent!!

  2. I am self employed and work as a painter and decorator but now I am staying at home as the customers do not want me until after Coronavirus will I get paid and who pays me thanks

  3. I’m working as a full employed. Just asking whose paying our 80% of our wages since lockdown start. I was working in a small company

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