Businesses forced to remain closed will have to start contributing to furlough payments from 1 July despite pleas from industry for further government support as the end of lockdown is delayed.
The delay from 21 June to 19 July will mean firms such as pubs and restaurants still having to operate at limited capacity and others such as nightclubs staying shut - putting hundreds of thousands of jobs at risk, it is claimed.
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Yet the timetable for tapering off support measures such as the furlough scheme and business rates relief remains in place.
A moratorium on evictions for commercial tenants - a lifeline for firms unable to pay their rent while they have been shut - is also about to come to an end.
The tapering of furlough means that, from the start of July, employers who currently receive subsidies to pay for 80% of laid-off workers' wages will instead receive just 70% and have to make up the extra 10% themselves.
The scheme then tapers off further month by month before ending after September.
Meanwhile, hospitality, leisure and retail firms currently receive a 100% exemption from business rates but from July this will be scaled back to a 67% discount.
Tony Danker, director-general of the CBI, said: "We must acknowledge the pain felt by businesses in hospitality, leisure and live events.
"At best they're operating with reduced capacity hitting revenues, and at worst, some aren't open at all.
"Continuing restrictions means the government must urgently revisit the support available.
"That starts with holding back on the tapering of business rates relief and extending the commercial rent moratorium for those sectors most impacted."
Claire Walker, co-executive director of the British Chambers of Commerce (BCC), said: "This delay to the removal of restrictions will come as a hammer blow to those firms who must remain closed, and to those who continue to see their ability to trade severely restricted.
"It would be extraordinary if we saw government retracting support to businesses now."
The Treasury pointed out that it had already supported 11.5 million jobs through the furlough scheme at a cost of nearly £65bn and that the number of people on it was falling.
That is backed by data last week released by the Office for National Statistics (ONS) showing that the number on furlough fell to 1.8 million in May, the lowest level since it began.
A spokesperson for the Treasury said the government "deliberately went long" with the furlough scheme, pushing it out until September when it was last extended at the budget earlier this year.
But Kate Nicholls, chief executive of UK Hospitality, said that with the hospitality sector already having lost more than £87bn in sales in the pandemic, leaving businesses deeply in debt, more support was needed.
"Simply put, if the supports provided by the chancellor are not sustained and adjusted, businesses will fail and getting this far will count for nought," she said.
UK Hospitality said the delay to the end of lockdown would cost the sector £3bn in lost sales and put at risk 300,000 jobs.
The British Beer and Pub Association (BBPA) said it would cost pubs £400m and create "real fears of a lost summer" for the sector.
The delay is particularly frustrating for pubs because it will restrict the number of drinkers who might otherwise have crowded in to watch Euro 2020 matches with a pint.
One restriction that will be lifted as planned is the 30-person limit on weddings, reception and wakes.
But the guidance that "everyone who can work from home must do so" remains in place, a blow to consumer-facing firms serving workers in city centres.
Shares in hospitality operators such as Whitbread - owner of Premier Inn - and The Restaurant Group - owner of brands including Wagamama - fell on Monday in the hours leading up to the expected announcement.
TUC general secretary Frances O'Grady called for targeted support for the worst-hit sectors.
She added: "The chancellor also needs to announce now that he will extend furlough for as long as is needed, rather than cutting it off abruptly in three months' time.
"Working people need this certainty now - not a rollercoaster approach to protecting livelihoods."
Nick Mackenzie, chief executive of pubs operator Greene King, said his business faced losing out on "substantial amount of trade that comes with the Euros" and the delay was "a disappointment for us and for our customers that were looking forward getting that matchday atmosphere back".
Mike Cherry, national chair of the Federation of Small Businesses, said: "For many people, it probably feels like life has been getting back to normal.
"But take a moment to remember that some small businesses, for example nightclubs, have remained closed throughout the entirety of the pandemic.
"Many small firms who have been hanging onto the edge will be left wondering if they can survive further periods of restrictions without additional support."
London mayor Sadiq Khan backed calls to extend business support, saying plans to scale it back risked "dire consequences" for businesses in sectors such as culture, nightlife and hospitality.
Equity, the performing arts union, said the delay was a "catastrophic blow" and called for more grants to support the sector as well as reform of support measures for the self-employed, which it says excludes a large proportion of its members.
Elsewhere, the Association of Independent Festivals called for government-backed insurance to give organisers the confidence to plan for events after the new lockdown-end date of 19 July.
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2021-06-14 19:41:15Z
CBMiaGh0dHBzOi8vbmV3cy5za3kuY29tL3N0b3J5L2NvdmlkLTE5LWxvc3Qtc3VtbWVyLWZlYXItb3Zlci1kZWxheS10by1lbmQtb2YtbG9ja2Rvd24tcmVzdHJpY3Rpb25zLTEyMzMyNjE10gFsaHR0cHM6Ly9uZXdzLnNreS5jb20vc3RvcnkvYW1wL2NvdmlkLTE5LWxvc3Qtc3VtbWVyLWZlYXItb3Zlci1kZWxheS10by1lbmQtb2YtbG9ja2Rvd24tcmVzdHJpY3Rpb25zLTEyMzMyNjE1
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