Tag: finance

Government scheme that protected millions of jobs with £38 billion of support lent to businesses closes today

  • The Covid Corporate Financing Facility, which provided a quick and cost-effective way to raise working capital for large firms, comes to an end with every penny repaid.
  • The Bank of England facility provided almost £38 billion of support to more than 100 of the UK’s biggest firms, and made a profit for the taxpayer whilst protecting millions of jobs.
  • Firms that employ almost 2.5 million people were directly supported including those in the car industry, travel, hospitality, and high street stores.

The Chancellor has hailed the success of a Covid scheme that provided almost £38 billion of support to some of the UK’s biggest employers during the pandemic, protecting millions of jobs whilst making a return for the taxpayer, as it comes to an end today.

Household names, such as Gatwick Airport, the Football Association and the National Trust, were among more than 100 of the UK’s biggest employers that benefitted from the Covid Corporate Financing Facility (CCFF). The scheme has recouped every penny that was lent – plus a profit of over £60 million.

Rishi Sunak said the Bank of England administered scheme, which was launched in March 2020 at the start of the pandemic, was another example of the government offering support at unprecedented speed to protect millions of jobs and taxpayer’s money simultaneously.

Chancellor Rishi Sunak said: “We not only took unprecedented action but did so at unprecedented speed to protect jobs and businesses throughout the pandemic.

“The CCFF scheme ensured that many of the UK’s biggest employers could continue to pay wages and suppliers, protecting millions of jobs – and on top of that every penny has been repaid.”

The final CCFF repayments were made today, with all companies paying back what they owed. The scheme has made a profit of over £60 million for the taxpayer because the rate of interest applied to the cash provided by the Bank of England was priced at rates comparable to the market before Covid. Companies therefore paid back a slightly larger amount at maturity compared to the finance they borrowed initially.

Peter Vermeulen, Chief Financial Officer at the National Trust, said: “The HM Treasury team did an amazing job during the height of the pandemic. The National Trust, like many other large organisations, experienced an unprecedented liquidity squeeze, accompanied by enormous levels of uncertainty around the future.

“The CCFF was set up swiftly and in a highly transparent manner. The team at HM Treasury issued clear guidance and worked tirelessly to support us with the application and the associated legalities.

“We cannot commend the team highly enough for the excellent work they have done. It was an essential lifeline for the National Trust and has safeguarded some of the essential work we do on cultural and natural heritage, for the Nation. Thank you.”

Mark Burrows, Chief Operating Officer at The Football Association, said: “The pandemic was a serious challenge for The FA. We were faced with huge losses from cancelled events and competition disruptions affecting our broadcasting rights.

“As a not-for-profit organisation that reinvests its surplus into grassroots football, being able to rely on the security of CCFF as a quick and cost-effective way to raise working capital meant we were able not only to continue to support our business, but grassroots football across the country.”

Through the purchasing of short-term corporate debt – known as commercial paper – the CCFF provided a quick and cost-effective way to raise working capital for companies who were fundamentally strong but were at risk of experiencing severe disruption to cashflows.

Because it lent directly to large companies, the scheme also provided banks with the space to lend to a wider population of firms who could have otherwise gone bust during the pandemic.

The scheme helped companies across a range of sectors including the car industry, travel, hospitality, and high street stores. It kept cash flowing and delivered on the government’s commitment to do everything it could to support the economy and protect jobs.

Experts back call to transform Scotland’s economy, protect the planet and provide wellbeing for all

Calls for radical, transformative changes to Scotland’s economy in order to ensure wellbeing for all within our environmental limits have been backed by  almost 40 leading economists and climate change academics.

In advance of the publication by the Scottish Government of its new economic strategy on Tuesday 1 March, these experts have endorsed Ten Points for a Transformative Economic Strategy produced by the ‘Transform Our Economy’ alliance.

These ideas outline a new purpose at the heart of our economy: providing wellbeing for all within environmental limits. They will require the government to set the trajectory for the economy and present a credible plan for delivery using all the powers at their disposal.

The alliance, comprising Scottish Environment LINK, Friends of the Earth Scotland and Wellbeing Economy Alliance Scotland, is also calling for much more extensive public debate about the direction of our economy and believes that participation from workers, affected communities and those who are in greatest need of economic transformation has been lacking.

Matthew Crighton, Sustainable Economy Adviser at Friends of the Earth Scotland said: “”In the midst of climate and nature emergencies, with too many people trapped in poverty and businesses still reeling from the impact of the pandemic, there is no question that economic transformation is needed.

“In the face of these challenges, the Scottish Government must plot a new direction in building a truly sustainable and just economy that can meet people’s needs.

“Recent history has shown us there is a persistent gap between high-level aspirations and the actual performance of the government in effectively intervening the economy in Scotland. The fear is that the new economic strategy won’t redesign the economy, but will instead continue to deliver inequality and environmental destruction.

“New ideas are sorely needed for a transformative economic agenda which can provide sufficient investment to deliver a just transition to zero carbon, integrate the protection of nature into economic decision making and ensure social equity and participation by currently marginalised groups.”

Professor Tim Jackson, Professor of Sustainable Development, University of Surrey and acclaimed author of Prosperity Without Growth backing the plan said: “With the forthcoming 10-year Strategy for Economic Transformation the Scottish Government has a unique opportunity to make Scotland a global example of an economy that is fit to address the challenges of the 21st century, delivering wellbeing for all within environmental limits.

“To do that, the Strategy needs to put at its heart care for people and planet, it needs to build on meaningful participation of those at the sharp end of our economy, and it needs to put in place measures which will give priority to ensuring people’s wellbeing rather than the pursuit of GDP growth for its own sake.”

The ten points proposed by the ‘Transform our Economy’ group offer a robust framework for building such a strategy. The Scottish Government would be well advised to take note.”

Professor Jan Webb, Professor of Sociology of Organisations, University of Edinburgh, and one of the 38 signatories, said: ““Orthodox economic strategy aims to maximise GDP, and then to make some adjustments for fairness and environmental harms.

“A transformative strategy, fit for addressing climate emergency and major inequalities, has to direct all economic action to achieving a fair, and sustainable, society.

“This means all investment prioritises decent work, zero waste, biodiversity and climate protection. I hope the Scottish Government will respond promptly and constructively to the Transform Our Economy alliance.”

The headings of the Ten Key Points are:
1. The goal: wellbeing for all within environmental limits
2. Setting specific economic objectives to care for people and the planet
3. Using all the tools available to government to meet those objectives
4. Policies must show how the objectives can be achieved
5. Combat economic pressures which are helping cause the problems
6. Public priorities must lead the direction of development of the economy
7. Clear tests for all investment programmes
8. Measure performance through metrics which matter
9. An economic strategy for all sectors – economic transformation as a national mission
10. An inclusive and participatory process

The full text of the Key Points can be read below:

Ten-Points-for-a-Transformative-Economic-Strategy-generalDownload

at https://foe-scotland.us2.list-manage.com/track/click?u=b5ad0d61b2a67d22c68bf7d8d&id=67d24d88dd&e=195fc3d780

Council budget to ‘boost frontline services and community improvements’

‘For two years now, we have demonstrated incredible resilience as a Council’ – Finance Convener Cllr Rob Munn

A budget ‘designed to support residents through the cost-of-living crisis and invest in local communities’ has been set by the City of Edinburgh Council.

Agreed by elected members on Thursday (24 February), millions of pounds from the Council’s annual budget for 2022/23 will be spent towards shaping a more sustainable, fair and thriving future for Edinburgh post-pandemic.

A fair city?

Councillors have agreed to direct an extra £1.1m towards easing the cost of living crisis for the city’s most vulnerable and £150 for 33,000 low-income households across the city at a total cost of £4.95m. This is on top of national cash grants announced by the Scottish Government.

Alongside this, an extra £100 will be provided for every child within a low-income home (identified via free school meals qualifications) and an additional £450k will be made available by the Council in crisis grant funding.

Frontline services will continue to be protected and the Council’s rent freeze for tenants will remain in place for another year.

Together with the Council’s ongoing £2bn programme to build 5,500 sustainable, quality Council homes and invest £1.3bn over the next 15 years in a new, green, well-connected neighbourhood at Granton Waterfront, around half a million pounds will be spent to provide social care adaptations to people’s houses to allow them to live more independently in their own homes.

£112k has been earmarked to make sure every school in the city is equipped with a life-saving defibrillator, and the Council will continue to invest £454m in capital investment for new school facilities across the city over the next ten years, together with an annual £48m to help families access 1,140 hours of funded early learning and childcare.

The roll out of 40,000 digital devices to school pupils across the city to close the digital divide will also continue, thanks to investment of nearly £18m. In recognition of pressures faced during Covid, £1m of additional funding will be provided for Children’s Services, while a further £2m will be invested adopting the recommendations of the Tanner review.

A welcoming city?

A one-off £1.1m ‘deep clean’ will remove graffiti and address street cleansing in the city centre and local wards, while quarter of a million pounds will see a new, Neighbourhood Action Team created to tackle hot spot areas of unkept land and deal with issues like overgrowth and fly tipping.

An extra £1m will be set aside for road and pavement maintenance to improve movement around the city and £450k will help to improve park facilities, creating even better green spaces in every ward and improved lighting. Meanwhile an extra £325k will be invested in playparks and £130k in expanding provisions for food growing across the city.

There will be £200k invested towards temporary toilets in select parks – repeating successful arrangements from summer 2021 – and £60k will be set aside to provide seasonal improvements and rangers to Pentland parks. An additional £60k will be contributed towards works to complete the restoration of the Portobello Kilns.

This is alongside £150k to be spent regulating and monitoring short-term lets in Edinburgh and related issues of anti-social behaviour.

A thriving and sustainable city?

An additional half a million pounds will support Edinburgh’s Net Zero ambitions, accelerating the city’s One Million Tree City programme, and £200k will be invested in Energy for Edinburgh, the Council’s publicly owned ESCO, to allow a zero-carbon energy project to move forward.

Up to £100k will be spent through Participatory Budgeting, supporting local communities to be involved in the running of the city, and £200k will be used to support local community festivals, including Edinburgh’s Diwali and the Leith Festival.

A commitment of £60k will support the re-opening of the city’s libraries after use as Covid testing facilities and the new Meadowbank Sports Centre will open later this year.

Spend of £160k will be directed towards taxi regulation and enforcement; £180k of funding will be set aside to cover potential costs relating to the temporary Hostile Vehicle Mitigation arrangements protecting the city centre; and £50k will be used to upgrade the ForeverEdinburgh website to further drive footfall to local businesses as Edinburgh recovers from the pandemic.

Finance and Resources Convener SNP Councillor Rob Munn said: “This Budget signals a more sustainable, fair and thriving future for Edinburgh post-pandemic.

“For two years now, we have demonstrated incredible resilience as a Council and as a City, banding together to support those who have needed extra help.  We have been at the forefront throughout and as life finally – and thankfully – starts to return to normal, we will continue to safeguard our services and focus on getting things back up and running.

“Our city centre and local high streets have suffered through lockdown restrictions and due to the cost of living, families on low incomes are struggling to make ends meet. The decisions we’ve made today aim to challenge these disadvantages and help our City and communities thrive in the year ahead.

“We’ll direct £1.1m each towards a ‘deep clean’ of the city centre and local areas and improving roads, helping to make Edinburgh a more welcoming place to be, and a further £1.1m will address poverty and inequality to create a fairer future.

“These are just a few of the very welcome spending decisions we’ve been able to make and I’m grateful to members in all parties for shaping these plans, but we do need to remain prudent. Times are hard and we know that the impact of Covid on our budget will continue into future financial years and significant savings will have to be made.”

Vice Finance and Resources Convener Labour Councillor Joan Griffiths said: “This Budget is about giving Edinburgh the chance to recover and grow as we safeguard our frontline services.

“The impact the pandemic continues to have on residents, on businesses and in our communities is clear. We’re now facing a cost of living crisis and it’s vital that we prioritise support for those who need it most.

“As we recover from everything the last two years have brought, investment enabled by a modest increase in Council Tax rates will help people in every single one of our communities, with the extra money raised used to maintain critical frontline services.

“We’re determined to use this budget to help us close the poverty gap, and we’ve also committed to keeping rents frozen this year for Council tenants. We’re putting more money into crisis grants, into new schools and new homes – while spending millions on community improvements.

“All of this will go towards making Edinburgh the most welcoming, thriving, and sustainable place it can be.”

This will be the SNP-Labour ‘Capital Coalition’s’ last budget before May’s council elections.

New Council Tax rates will be brought into effect on 1 April 2022 as follows:

Council Tax Bands 2022/23

A: £919.17

B: £1,072.36

C: £1,225.56

D: £1,378.75

E: £1,811.52

F: £2,240.47

G: £2,700.05

H: £3,377.94

Further details can be found at edinburgh.gov.uk/budget-finance.

Cost of living support for students

Students facing financial hardship due to the cost of living crisis and rising energy costs can apply for more support.

This week more than £5 million has been distributed to help Higher Education students in financial hardship with basics like heating and other household costs. This is part of a £37 million hardship funding provided by the Scottish Government since June 2021.

The Scottish Funding Council (SFC) will meet colleges’ Further Education student support funding requirements, and have also provided a further £6 million for financial support for FE students, in this academic year.

Higher and Further Education Minister Jamie Hepburn has written to college and university principals, asking them to encourage students most in need to apply and to prioritise allocation of funding.

To further support students, Mr Hepburn has announced:

  • a £350 loan uplift for 2022-23 in higher education. This means that the most disadvantaged students can access £8,100 per year through bursary and loan
  • the introduction of a new 12 monthly payment option in 2022-23 for higher education students receiving the Care Experienced Bursary, so support is also available over the summer months

Mr Hepburn said: “Many students are facing higher energy bills and increased financial hardship as a result of the cost of living crisis.

“I have written to university and college principals asking them to ensure that discretionary funds remain accessible for students most in need and that in distributing funds, they should take account of the impact rising energy prices will be having on students, particularly those in private rented accommodation.

“I have also asked them to add students facing rising energy bills to the priority groups so they can access the funds. Students can also apply for support through the Fuel Insecurity Fund, which is distributed through third sector organisations.”

Further talks on fiscal reform

Clarity needed on Barnett consequentials

During yesterday’s session of the Joint Executive Committee (JEC) with the Chief Secretary to the Treasury Simon Clarke, Finance Secretary Kate Forbes outlined some of the challenges needing to be addressed as part of the forthcoming joint review of the Scottish Fiscal Framework.

Chairing the meeting in London, Ms Forbes highlighted the need for further collaboration on fiscal flexibility, including consideration of further financial powers as part of the forthcoming Fiscal Framework review.

The meeting follows the UK Government’s Council Tax Energy Rebate announcement and the consequential funding for the Scottish Government.

The Spring Budget Revision has also been published showing that the Scottish Government has spent almost £15 billion on measures to respond to COVID-19 since the beginning of the pandemic. It represents the final decisions made in the Scottish Government budget allocations for this financial year despite the challenges due to late notification of consequentials.  

 

Speaking following the JEC, Ms Forbes said: “I have had a constructive conversation with the Chief Secretary to the Treasury this afternoon, where there was a frank exchange of views on what is quickly required from the Fiscal Framework Review and the need for further fiscal flexibility for Scotland.

“Our experiences of dealing with both the health and economic impacts of the pandemic and supporting those struggling with the cost of living crisis clearly demonstrate how difficult it is to take actions we deem vital without sufficient fiscal powers and often with late notice or lack of engagement when further funding is coming.

“This has been proven once again today. Whilst I will always welcome funding, the net change to our budget isn’t clear yet  – we are awaiting urgent clarity on this from the Treasury and how it will impact our final settlement for the current year.

“As the First Minister has said, we will pass on the full consequential funding to support people struggling with the current costs of living. Council Tax is already lower in Scotland and our current support such as the single Council Tax Reduction Scheme protects 470,000 lower income households.”

And the UK Government’s take on yesterday’s meeting:

Chief Secretary to the Treasury Simon Clarke held talks with the Scottish Government’s Cabinet Secretary for Finance and the Economy Kate Forbes yesterday to discuss the upcoming review of the Scottish Government’s Fiscal Framework.

The ministers agreed they were close to finalising arrangements for an independent report on the Scottish Government’s Block Grant Adjustment arrangements which will inform the review.

They shared the ambition to get this first stage launched as soon as possible.

The Chief Secretary and Cabinet Secretary also agreed that the Fiscal Framework review should be guided by principles set out in the Smith Commission agreement. They discussed the importance of several principles, including fairness and consistency, as well as the need to have a framework that is implementable, sustainable and operates effectively in practice.

Both ministers expressed a desire to avoid unnecessary delays to starting the Fiscal Framework review, and agreed to continue a dialogue and joint preparations for the review while the independent report is underway.

Ministers also discussed financial impacts relating to the income tax personal allowance.

Chief Secretary to the Treasury Simon Clarke said: “Today was an enjoyable and productive meeting. We are working closely with the Scottish Government and engaging in regular discussions on the Fiscal Framework review, making good progress on our approach to the Scottish Government’s future finances.”

Additional funding boost for councils

An amendment will be brought forward during Stage 2 of the Budget Bill to allocate an additional £120 million to local authorities. The funding represents the equivalent of a 4% Council Tax rise.

Finance Secretary Kate Forbes said whilst councils have full flexibility in setting local council tax rates, there is no requirement for any inflation-busting increases in 2022-23.

The money is being made available after the UK Government advised that the Scottish Government should anticipate further funding for 2021-22, funding which will be confirmed at the Spring Supplementary Estimates next month.

Speaking during the Stage One Budget Bill debate, Ms Forbes said: “I am in no doubt about the important role local authorities play in our communities and in helping manage our ongoing response to the pandemic. I also understand the financial challenges they face.

“The 2022-23 Scottish Budget remains fully allocated and for weeks the UK Government has been telling us not to expect further funding. That has now suddenly changed and the UK Government has advised that we should anticipate further funding for 2021-22 which will be confirmed at the Spring Supplementary Estimates next month.

“Consequently I now have some new flexibility and am pleased to confirm my intention to utilise the Scotland Reserve to carry forward sufficient funding to allow me to allocate a further £120 million of resource to local government. Councils will have complete flexibility to allocate this additional funding as they wish in 2022-23.

“Councils asked for an additional £100 million to deal with particular pressures. We have heard them and listened and we are going to go further. This will allow them to deal with the most pressing issues they face.

“At a time when people are understandably worried about the cost of living, I would point out this increase in funding would be equivalent to a 4% increase in Council Tax next year, so whilst councils have full flexibility in setting local council tax rates, I do not believe that there is a requirement for any inflation-busting increases next year.”

National Energy Savings Week: Finance expert on reducing fuel usage and saving money

Personal Finance Expert at CashLady.com, Paul Wilson, shares his top tips on how Brits can reduce their fuel usage and save money this Energy Savings Week: 

It looks like energy prices are likely to rise higher than ever before in 2022. Making sure you’re getting the best deal has never been more important, and taking steps to cut back your fuel usage should be on everyone’s agenda.

Even small changes can help put some money back in your pocket and big tasks, like moving to a new tariff, are worth looking into. This Energy Savings Week, why not try some of these nine ways to reduce your fuel usage and help keep your finances on track. 

1.          Draught excluders

Make sure your doors aren’t letting out valuable heat and letting in the cold. You can buy permanent solutions that attach to the bottom of your door, or decorative excluders that are a quick and easy option. Draught excluders are an inexpensive and effective way to quickly tackle any lost heat from your home.

2.            Seal your windows

In the same vein as draught excluders, making sure your windows are sealed against the cold is a quick win. Older houses especially can have less efficient windows. Window sealing strips can be bought from most DIY stores and are available in various styles to also complement home decor. Additionally, if you have curtains, use them! Lined curtains will keep your room warm in winter and cooler in summer, meaning less need to rely on your heating or cooling systems.

3.            LED Bulbs

The initial outlay may be a little steeper when it comes to LED bulbs. However, they use 75% less energy than their incandescent counterparts, so it’s a switch worth making. They also last longer and so you won’t need to buy them as often which results in long-term savings and less waste. 

4.            Plan and prepare 

Simply being mindful of how and when you use energy can lead to some simple savings. Many of us have our heating on a timer; regularly reassess if the times you use the heating still make sense. Perhaps you still have the same settings you had over the Christmas break, but now you’re home less during the day. There may also be evenings when you’re out and don’t need the heating at all. Turn it off before you leave so you aren’t wasting unnecessary energy.

5.            Be mindful

Just as you can plan and prepare when to have your heating on, you can also consider where in the house you actually need the heating. If the spare room is used for the rare times you have guests, then you can turn that radiator off and shut the door. Radiator valves are also there to be used. Smaller box rooms may be fine with a lower setting. Not everyone you live with will like the same level of heat; children’s rooms may need a lower temperature if they tend to get hot in the night. Think carefully about how you are using your heating, not just when you use it.

6.            Other appliances

There are a whole host of things we use daily in our homes that burn fuel. Make sure lights are switched off when rooms are not in use, put post-it notes on the switches as a reminder if needs be. Try not to use the dryer as this is a huge energy burner, instead put clothes on radiators that are being used anyway. Washing your laundry in large loads rather than little and often is another way to be more efficient. Consider batch cooking some of your weekly meals and freezing them. That way, you’re having to cook less which means using the oven less. 

7.            Credit where it’s due

Find out from your energy company if you’re in credit. If you have regular meter readings and pay by direct debit, you may have been paying too much. This can result in you being in credit. You can choose to carry this credit over, which may reduce your monthly bills, or you can ask for a refund. Energy companies have to issue a refund if you are in credit and you could save this towards future bills or just put it aside for a rainy day. 

8.            Your tariff

Traditionally, moving onto a company’s default tariff has been the most expensive option. As soon as your fixed tariff is coming to an end, you should speak to your energy company about a new deal. However, with energy prices now so high, the capped default price may actually be cheaper than the fixed option. Do your homework and find out if you may now be better off staying with the default tariff until prices (hopefully) decrease, or if your specific usage means you would be better off with a new fixed deal.

9.            Change providers 

As with moving to a different tariff, switching providers is now not as cut and dried as it used to be. As many as 20 energy firms have gone bust recently, so you need to make sure you choose a provider that is stable. Use price comparison sites to see if moving companies could be a good thing, but be sure to do your sums first and don’t assume it will lead to savings. You should also only switch at the end of your contract as, quite often, firms charge an exit fee if you still have several months left on your deal. 

Paul Wilson is a Consumer Finance Expert at Financial Conduct Authority authorised and regulated credit broker Cash Lady.

Retirement misery still looms for thousands, despite reforms

New pension regulations came into force on 30 November 2021. The new regulations permit Trustees to block or suspend a suspicious-looking pension transfer if they believe that the transfer could be to a scheme that is fraudulent.

These new regulations could prove to be the most significant development in preventing pension scams.

Paul Higgins of Pension Justice, a law firm that has helped recover millions of pounds in mis-sold pensions, says: “I am delighted that the Government has brought in this new rule, and I hope  that this will prevent pension scams taking place so that pension investors will not lose their life savings.

“Unfortunately, there are still hundreds of thousands of people who have previously taken their money out of pensions and handed over their life savings after being badly advised to invest in worthless, unregulated investments like carbon credits, ethical forestry, storage pods, to name but a few”.

One of Pension Justice’s clients, Mrs F from Burnley, lost her entire life savings worth over £157,000 after being persuaded by an “advisor” from Asset Management Advisory Services (AMASS) Ltd (t/a AMASS Europe) to transfer her pensions into a SIPP and “invest” in an EPS Portfolio with Avalon.

The advisor paid themselves £3,842.10 in commission and then arranged to “invest” Mrs F’s £149,000.00 in what turned out to be unregulated funds promising unrealistically high returns.

The investments subsequently failed, and Mrs F lost her entire life savings. It then transpired that the advisor and their company had minimal authorisation from the Financial Conduct Authority and were not authorised to provide advice on pensions and investments.

Pension Justice took up the case with the FSCS (Financial Services Compensation Scheme) and recovered compensation of £85,000.00 on behalf of their client which was the maximum payable under the scheme.  

Paul says: “One of Mrs F’s pensions was a gold-plated defined benefit scheme pension with Proctor and Gamble. Under the new rules Proctor and Gamble could have prevented the transfer from taking place and, in which case, Mrs F would not have lost her life savings. 

“Unfortunately, we know that there are still hundreds of thousands of pension investors who have lost all their pensions and are facing a miserable retirement with little or no money apart from their state pensions. Some are even being forced to carry on working way past retirement age”.

Paul and his team at Pension Justice have managed to recover sums up to  £189,591.37 for his clients, many of whom have been scammed by cold callers and told that they could “double their money” or are promised potentially incredible returns if they transfer their hard-earned pension pots. 

Business support plans announced

First Minister Nicola Sturgeon last week announced how £107 million is being allocated to support businesses impacted by the spread of the Omicron variant.

The funding, which follows an initial £100 million lifeline package, means the Scottish Government has now allocated £207 million of the £375 million committed to business support. Following discussions with stakeholders, this latest package is targeted at some of the hardest hit sectors and payments will start in the new year.

Business support is being provided to mitigate the impact of public health measures introduced to limit the rapid spread of the Omicron variant. Proportionate restrictions have been implemented for at least three weeks to allow immunity from the accelerated booster vaccination programme to take effect.

Decisions on the allocation of the remaining £168 million will be confirmed following consultation with affected sectors on how it can best be targeted

The latest £107 million support package is broken down into:

  • £32 million more for hospitality and leisure businesses
  • £10 million targeting parts of the hospitality industry most severely affected by requirement for table service
  • £5 million targeted support for nightclubs now required to close
  • £27 million for culture, due to impact of physical distancing and caps on attendance
  • £17 million for events, due to impact of physical distancing and caps on attendance
  • £16 million for existing public transport COVID-19 support schemes to recognise the impact on fare revenue

Final details of the funding available for each sector is being determined in discussion with business and sector organisations and will be published as soon as possible.

Hospitality businesses will be contacted by their local authority to access top up funding through the December and January Business Top Up.

First Minister Nicola Sturgeon said: “We recognise that the public health measures necessary to limit the spread of Omicron have had a severe economic impact, especially for sectors like hospitality and culture which would normally be experiencing their busiest trading period.

“We will be providing a total of £375 million for affected businesses and continue to press the UK Government for more comprehensive support, akin to what was provided earlier in the pandemic. We know this funding won’t cover all losses but it is to compensate for cancellations and ensure businesses can survive the winter period and be ready to trade fully in the new year.

“The best way to support business sustainably is get the virus back under control. Please get your boosters and stay at home as much as possible just now.”

Scottish Government commits £100 million to support businesses

Pressure on UK Government to deliver more financial support as Omicron cases surge

First Minister Nicola Sturgeon has announced the breakdown of a lifeline £100 million financial package to support businesses experiencing cancellations due to the rapid spread of the new Omicron variant.

The £100 million support package is broken down into:

  • £66 million for eligible hospitality businesses
  • £20 million for the culture sector
  • £8 million for food and drink supply chain businesses including wholesalers
  • £3 million for the wedding sector
  • £3 million for the worst affected businesses in the tourism sector, including international inbound tour operators

Final details of the funding available and how to apply is being determined in discussion with business organisations and will be published next week.

Eligible hospitality businesses will be contacted directly by their local authorities and will not need to apply for support.

Food and Drink wholesalers can apply for funding through a re-run of the Scottish Wholesale Food and Drink Resilience Fund in January 2022.

Guidance has also been published to enable businesses to take reasonable measures to limit the rapid spread of the Omicron variant.

First Minister Nicola Sturgeon said: “The steps we are asking people to take are already having a severe economic impact, particularly for sectors like hospitality and culture, which have been badly affected by previous waves of Covid and were hoping for a better Christmas period this year. This is why we have found £100 million to help businesses in those sectors.

“The support we’re providing is significant – but we know it won’t fully compensate for the impact of Omicron. Business now needs the type and scale of financial support that was available earlier in the pandemic and that can only come from the UK Government – which has borrowing powers that the Scottish, Welsh and Northern Irish governments do not.

“The best way to support business sustainably, is to get the virus back under control. Please get your boosters and stay at home as much as possible just now.”

Downing Street confirmed that The First Minister spoke with Prime Minister Boris Johnson later in the afternoon.

In a statement, the PM’s office said:

‘The Prime Minister has spoken to First Minister Nicola Sturgeon this afternoon to discuss the ongoing response to the Omicron variant.

The Prime Minister and the First Minister agreed on the importance of close collaboration for the benefit of citizens across the UK.

They discussed the shared challenges including the economic disruption caused by Covid and will continue to work together.

The Prime Minister confirmed UK Government will be convening a COBR meeting over the weekend with counterparts from the devolved administrations to continue discussions.