UK sets out plan to boost economy amid coronavirus hit
LONDON (Reuters) – British finance minister Rishi Sunak warned of hardship ahead on Wednesday as he set out plans to protect jobs and limit the economic impact of the coronavirus.
Britain’s Chancellor of the Exchequer Rishi Sunak reacts as he leaves Downing Street, in London, Britain July 8, 2020. REUTERS/Hannah Mckay
Below are highlights of Sunak’s speech to parliament.
Job retention bonus
“We’re introducing a new policy to reward and incentivise employers who successfully bring furloughed staff back – a new Jobs Retention Bonus.”
“If you’re an employer and you bring back someone who was furloughed – and continuously employ them through to January – we’ll pay you a 1,000 pound bonus per employee.”
“For businesses to get the bonus, the employee must be paid at least 520 pounds on average, in each month from November to the end of January.”
“If employers bring back all nine million people who have been on furlough, this would be a 9 billion pound policy to retain people in work. Our message to business is clear: if you stand by your workers, we will stand by you
“The Kickstart Scheme will directly pay employers to create new jobs for any 16 to 24-year-old at risk of long-term unemployment.”
“I’m making available an initial 2 billion pounds; enough to fund hundreds of thousands of jobs.
“And I commit today: there will be no cap on the number of places available.”
Eat out discount
“For the month of August, we will give everyone in the country an Eat Out to Help Out discount. Meals eaten at any participating business, Monday to Wednesday, will be 50% off, up to a maximum discount of £10 per head for everyone, including children.”
“Each week in August, businesses can then claim the money back, with the funds in their bank account within 5 working days.”
Stamp duty property tax
“I have decided today to cut stamp duty.
Right now, there is no stamp duty on transactions below £125,000. Today, I am increasing the threshold to half a million pounds.”
“This will be a temporary cut running until 31st March 2021. And, as is always the case, these changes to stamp duty will take effect immediately.”
Sales tax VAT
“At the moment, VAT on hospitality and tourism is charged at 20%. So I’ve decided, for the next six months, to cut VAT on food, accommodation and attractions.”
“Eat-in or hot takeaway food from restaurants, cafes and pubs; Accommodation in hotels, B&Bs, campsites and caravan sites; Attractions like cinemas, theme parks and zoos; All these and more will see VAT reduced, from next Wednesday until January 12th, from 20% to 5%.”
Green homes grant
“I’m announcing today a new, 2 billion pound Green Homes Grant. From September, homeowners and landlords will be able to apply for vouchers to make their homes more energy efficient and create local jobs”
“Leaving the furlough scheme open forever gives people false hope that it will always be possible to return to the jobs they had before. And the longer people are on furlough, the more likely it is their skills could fade, and they will find it harder to get new opportunities.
“It is in no-one’s long term interests for the scheme to continue forever.”
Department of work and pensions
“I’m investing an extra 1.2 billion pounds in DWP, to support millions of people back to work”
Goal of plan
“Our plan has a clear goal: to protect, support and create jobs. It will give businesses the confidence to retain and hire. To create jobs in every part of our country. To give young people a better start. To give people everywhere the opportunity of a fresh start.”
“I can tell the House we will produce a Budget and Spending Review in the autumn. And we will deal, too, with the challenges facing our public finances. Over the medium-term, we must, and we will, put our public finances back on a sustainable footing.”
Reporting and photo: Reuters