[UK] The Chancellor’s Summer Statement 2020

08 JUL 2020

Chancellor Rishi Sunak delivered his Summer Statement for 2020 today, The Guardian reports its main points with quotes from the Chancellor and deeper analysis. The highlights are summarised here.

In his opening remarks, the Chancellor said that people are anxious about losing their job and unemployment rising. He is announcing a plan to protect, create and support employment and declared that Britain is entering the second phase of the government’s economic response. The job of responding to the crisis has only just begun, Mr Sunak reportedly said.

Furlough scheme

  • The furlough scheme will wind down flexibly and gradually until the end of October 
  • A jobs retention bonus will help to wind down the scheme: businesses will receive £1,000 if they retain furloughed staff

Kickstart scheme

  • The “kickstart” job creation scheme for young people is announced
  • The government will pay six months of wages for new young employees
  • An initial £2bn will be available to fund hundreds of thousands of jobs
  • There will be no cap on the number of places available.

Training and jobs

  • Jobcentre work coach numbers will be doubled
  • Apprenticeships will be supported by bonuses for companies
  • Companies will receive a payment of £2,000 for each apprentice taken on
  • Companies taking on apprentices over the age of 25 will receive £1,500.

Green investment

  • The government wants a “green recovery with concern for our environment at its heart”
  • It will provide £3bn for decarbonising housing and public buildings
  • Vouchers worth £5,000 and up to £10,000 for poorer families will be made available 
  • Vouchers via a £2bn pot to retrofit homes with insulation, cutting carbon emissions
  • £1bn will be allocated to make public buildings greener

Stamp duty

  • The Chancellor will cut stamp duty to reinvigorate the housing market
  • The threshold for stamp duty will increase from £125,000 to £500,000
  • The cut is temporary and runs until 31 March 2021, it will take immediate effect

VAT cut for hospitality

  • Hospitality sector among the hardest hit by COVID-19 warranting further support
  • VAT on food, accommodation and attractions will be cut from the current rate of 20 per cent to 5 per cent for the next six months
  • The cut applies from today (July 8) until January 12, 2021
  • Move intended as a £4bn catalyst helping 150,000+ businesses and consumers

Discounts on eating out

  • An “eat out to help out discount” is announced to encourage consumer spending at restaurants and cafes and help support the jobs of 1.8 million industry workers
  • Meals eaten at any participating businesses - from Mondays to Wednesdays in August - will be discounted by 50 per cent (up to a maximum reduction of £10 per head) for all customers, including children
  • Businesses can register for the scheme through a website launching on Monday
  • Businesses claiming money back will have money in their bank accounts within five working days
Source: The Guardian



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