A new £30 billion package of support designed to help the UK economy recover from the Covid19 pandemic has been announced by the Chancellor Rishi Sunak.
Delivering his Summer Statement in Parliament, he focused on protecting jobs and giving a helping hand to key industries affected by lockdown.
‘Job Retention Bonus’
Resisting calls to extend the furlough scheme beyond October, Mr Sunak instead opted to reward employers who retain furloughed employers until at least January 2021 with a one-off £1,000 payment.
The Chancellor has previously argued that extended the Job Retention Scheme would give some workers false hope about the prospect of returning to work.
VAT and Eat Out to Help Out
There was also particular support for the hospitality industries, with VAT cut to 5% for restaurants, hotels and visitor attractions for six months. Both sit-in and hot takeaway food will benefit, as well as food and non-alcoholic drinks in restaurants, pubs, and cafes.
Adding to support for the food industries, Mr Sunak also announced the Eat Out to Help Out scheme – a 50% discount up to £10 per person on food and non-alcoholic drinks at participating restaurants, pubs and cafes throughout August on Mondays, Tuesdays and Wednesdays.
Having initially planned to introduce a cut to stamp duty in England and Northern Ireland in October, critics argued it would be the housing market to a halt until then. As a result, the Chancellor said the change would take effect immediately and run until 31 March 2021.
The move will see the threshold for stamp duty rise from £125,000 to £500,000, meaning nearly 90% of residential transactions would be tax-free.
The Statement also revealed up to £5,000 per house to make homes greener in England.
Having announced it in the days prior to the Summer Statement, the Chancellor revealed more detail on the program designed to get young people into work.
The ‘Kickstart Scheme’ will fund a National Minimum Wage for 25 hours per week for 16-24 year olds on universal credit over six months.
Employers will also receive a £1,000 payment for every traineeship they create, with the aim of tripling numbers .
Employers in England hiring apprentices under the age of 25 for six months will receive a £2,000 grant, with those hiring apprentices over 25 receiving £1,500.
Mr Sunak announced £1bn worth of grants for public sector organisations to improve their green credentials and reduce carbon emissions.
And there was also a £50 million pot for social housing to increase decarbonisation in socially rented homes.