The leaders of Greater Manchester and Merseyside have accused the government of only providing extra support to coronavirus-hit businesses once restrictions were imposed on parts of southern England.
Chancellor Rishi Sunak on Thursday broadened support for firms and workers affected by localised COVID-19 measures with billions of pounds of extra help.
This included changes to the Job Support Scheme, which replaces the furlough scheme from next month, to allow employees in open businesses to work only one day a week to be eligible for support, with employer contributions for unworked hours falling to 5%.
Grants for the self-employed will be doubled to 40% of pre-crisis earnings, increasing the maximum grant from £1,875 to £3,750.
And businesses affected by Tier 2 restrictions will be able to claim cash grants worth up to £2,100 a month from local authorities, to be backdated from the introduction of those measures.
Image: Measures under Tiers 1, 2 and 3 of England’s lockdown system
The announcement came just two days after the government walked out of talks with Greater Manchester’s leaders on a financial support package to accompany the region being placed into Tier 3 restrictions.
Ministers were accused of failing to grant an extra £5m that would have secured the agreement of local leaders and averted Prime Minister Boris Johnson from having to unilaterally impose fresh measures.
The chancellor’s announcement of further economic support, for which firms will be able to backdate claims from August, riled politicians in the north of England.
They claimed Mr Sunak had only acted following the imposition of Tier 2 restrictions on London last week, even though other parts of England – including Greater Manchester – had been living under similar measures for months.
Andy Burnham, the mayor of Greater Manchester who has recently been engaged in a bitter political row with ministers, posted on Twitter: “Honestly, can barely believe what I’m reading here.
“Why on earth was this not put on the table on Tuesday to reach an agreement with us?
“I said directly to the PM that a deal was there to be done if it took into account the effects on GM businesses of three months in Tier 2.”
Chancellor sets out three extra support measures
Sir Richard Leese, the leader of Manchester City Council, tweeted: “Looks like Rishi Sunak is agreeing with Greater Manchester Leaders. Pity he couldn’t have done it two weeks ago.”
And Steve Rotherham, the mayor of the Liverpool City Region, said: “It’s a shame that it took London coming under further measures for the Chancellor to take action to support jobs and businesses.”
London, most of Essex and Elmbridge in Surrey were last week put into Tier 2 measures, which means people must not socialise with other households indoors, including in pubs and restaurants.
Similar measures had been in place in large parts of the North West since the summer.
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Speaking later at a Downing Street news conference, Mr Sunak said the Job Support Scheme was designed over the summer “with a view to the economy being open and restrictions being lifted”.
“Obviously the last few weeks, that has not been as those businesses had expected,” he said.
“Those restrictions were coming back, they were having a cumulative effect on the ground, particularly in Tier 2 areas, particularly in hospitality.
“That’s been the cumulative weight of the changes and the impact, more broadly, on consumer confidence that we’ve seen.
“And that’s why we’ve been in discussions to try and see what changes we can make that would do what we want to do – which is to try and protect jobs and employment at this difficult time.”
Mr Johnson said: “The negotiations between regional leaders, between metro mayors, was all about fairness – that’s what that discussion was about, it was about making sure everybody got the same package.
“What we’re trying to do now is address a national issue, which is that – obviously since the virus started to come up again – there’s been much more concern, particularly amongst the business community, about people’s ability to protect jobs and livelihoods because of the effects of the virus.”
The latest row over the government’s new three-tier approach to localised lockdown rules came as ministers were warned by Dan Jarvis, the Sheffield City Region’s mayor, that coronavirus had put northern England “on course for levelling down, not up” – in contrast to the prime minister’s general election pledge.