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22 October 2020, 12:11 | Updated: 22 October 2020, 12:27
Rishi Sunak has said there are "difficult days and weeks ahead" as more areas head into Tier 2.
Rishi Sunak has revealed today he will be giving grants of £2,100 for 150,000 hospitality businesses which are struggling to stay afloat under new restrictions.
Speaking to the Commons on Thursday, the Chancellor said firms hardest hit by tough Tier 2 rules will be able to claim more cash.
Businesses in the hospitality, accommodation and leisure sector can access up £2,100 for every month they are in Tier 2 restrictions.
These companies will also be able to backdate these claims for the time they have already spent in local lockdown.
Under the tier two level of lockdown, residents are banned from mixing indoors (including homes and pubs) with people from outside their households and support bubbles.
They are also be told to make as few journeys as possible, but will not be told to stay at home.
Mr Sunak said: "People need to know this is not forever. These are temporary restrictions to help control the spread of the virus.
"There are difficult days and weeks ahead. It is clear that even businesses who can stay open are facing profound economic uncertainty.
"I am introducing a new grant scheme for businesses impacted by Tier 2 restrictions, even if they aren't legally closed.
"We will fund local authorities to provide businesses in their area with direct cash grants."
Those who are forced to close in Tier 3 are already able to claim up to £3,000 a month from the Government.
Elsewhere in his speech, Mr Sunak announced that the Jobs Support Scheme is being made 'simpler and more generous'.
This means staff only need to work one day a week to be eligible and the contribution employers make has been reduced.
The scheme comes into effect on November 1 and will now see businesses only have to pay 5% of unworked hours, rather than 30%.
Those who are self employed will also be getting more help as the Self-Employment Income Support Scheme is being doubled from 20% to 40%.
Now, the maximum grant will increase from £1,875 to £3,750, over three months.