The UK government has announced increased support through the existing Job Support Scheme and self-employment scheme, as well as expanded business grants to support those in high-alert Covid level areas.

Chancellor of the exchequer Rishi Sunak said: “I’ve always said that we must be ready to adapt our financial support as the situation evolves, and that is what we are doing today. These changes mean that our support will reach many more people and protect many more jobs.

“I know that the introduction of further restrictions has left many people worried for themselves, their families and communities. I hope the government’s stepped-up support can be part of the country pulling together in the coming months.”

The Job Support Scheme, which will come into effect on 1 November, has now been updated so that employers only have to pay 5% of their employees’ wages for the hours not worked (it was previously a third), and employees are now required to work a minimum of 20% of their normal hours (previously 33%), so those working just one day a week will be eligible.

Employers will continue to receive the £1,000 Job Retention Bonus, and the Job Support Scheme Closed for businesses legally required to close remains unchanged.

For the self-employed, the amount of profits covered by the two Self Employment Income Support Scheme grants has increased from 20% to 40%, which means the maximum grant available will increase from £1,875 to £3,750.

Rishi Sunak also announced additional funding to support cash grants of up to £2,100 per month primarily for businesses in the hospitality, accommodation and leisure sector that may be adversely impacted by the lockdown restrictions in high-alert Covid level areas.

These grants will be available retrospectively for areas that have already been subject to lockdown restrictions, and comes on top of higher levels of additional business support for Local Authorities moving into Tier 3. Businesses that aren’t legally required to close, but have been adversely affected by local restrictions nonetheless, are also eligible for the grants.

Dame Carolyn Fairbairn, director general of Confederation of British Industry, commented: “The Job Support Scheme will be a welcome and much-needed successor to the furlough scheme and will protect many livelihoods when it begins.

“It’s right that businesses contribute if they wish to access this scheme. But with a tough winter ahead, significantly increased government contributions to non-worked hours across all regions will do even more to protect people’s livelihoods.

“Meanwhile it’s great to see the extra grant funding give local authorities the discretion to target where support is needed most. This is a big step towards a more standardised approach of support for areas going into tiers two and three, and those businesses that face tough times who operate within them.”

Chairman of the Federation of Small Businesses, Mike Cherry, added: “This is a welcome intervention which will help protect more jobs and small businesses, as well as self-employed traders, through the difficult winter months.

“Measures to combat Covid-19 make this a tough time for many small businesses, but we are determined to make it through. These measures will help make that happen.”