LONDON—The British government reversed course and joined other European countries in offering extended help to businesses in the face of a new surge in coronavirus cases.
The announcement follows the imposition this week of a new set of restrictions on the U.K. economy because of the rise in Covid-19 cases, which has led some forecasters to predict a further downturn in the economy later this year.
Britain has already suffered the highest death toll of any European country, and the size of its economic contraction in the three months through June was more than double that of the U.S. and exceeded only by Peru and India.
After resisting an extension of support for businesses beyond the end of next month, the government shifted course on Thursday to give an additional six months of support for firms that can’t offer full-time work to their staff.
“Back in March, we hoped we were facing a temporary period of disruption,” said Rishi Sunak, the government’s Treasury chief. “It is now clear that for at least six months the virus and restrictions are going to be a fact of our lives.”