The Plan for Jobs: Government announces help for businesses in Summer Update
VAT cut for hospitality businesses, bonuses for keeping your furloughed employees and vouchers for green home improvements – today’s Summer Economic Update by Chancellor Rishi Sunak had much to both offer consumers and small business owners.
The update contained Sunak’s ‘Plan for Jobs’ which he set out as the second of a three-phase plan to help the UK economic recover from the coronavirus crisis. Sunak explained that the first phase was about protection, and the third will be about rebuilding, to be announced in autumn this year.
Here are the details from today’s Summer Update and how they might affect you and your business:
Employment and skills
The Chancellor began the section of the announcements by confirming that the furlough scheme – the Job Retention Scheme – will end in October 2020.
Sunak said that these initiatives are designed to give you the confidence you need to keep and hire staff, and provide workers with the skills they need to get better jobs.
- Job Retention Bonus
This new scheme is to encourage you to keep on your furloughed workers. You’ll get a one-off bonus of £1,000 for each furloughed employee who you still employ as of 31 January 2021.
- Kickstart Scheme
This will provide subsidised jobs for people aged 16-24 at risk of long-term unemployment. The Government will fund job placements – at the National Minimum Wage for 25 hours a week – for six months.
The Government will give businesses £2,000 for each new apprentice you hire who is aged under 25. This is in addition to existing schemes.
The Government will give more funding to increase traineeships and work academy placements.
- Career advice
There will be more funding for the National Careers Service to help them give personalised advice about work and training.
- Support for the long-term unemployed
Sunak committed an extra £1 billion for the Department for Work and Pensions (DWP) to help the long-term unemployed.
Support for the hospitality industry
Sunak said these measures are designed to help “get our pubs, restaurants, cafes and B&Bs bustling again”.
As many consumers are being more careful with their spending, these measures are to help get customers back through your doors.
- VAT cut
From 13 July, there will be a VAT cut from 20% to 5% on food and drink. VAT will also be reduced for the hospitality and tourism sectors, from the 15th July 2020 until 12th January 2021 (also from 20% to 5%). This cut will apply to eat-in or hot takeaway food from restaurants, cafes and pubs, accommodation in hotels, B&Bs, campsites and caravan sites, and attractions like cinemas, theme parks and zoos.
- Eat Out to Help Out
This scheme will entitle diners to 50% off, up to £10 per person, on food and non-alcoholic drinks at participating restaurants, cafés, pubs or other eligible food service places. You’ll be able to use the discount unlimited times, Monday to Wednesday, on any eat-in meal for the whole of August 2020. Participating businesses will be fully reimbursed for the discount.
Property and Housing
Today’s announcements bring good news for people in the process of or thinking about buying or selling their home this year, and good news for construction companies:
- Stamp duty holiday
No stamp duty on the first £500,000 of all England and Northern Ireland property sales from 8 July until March 2021. According to the Chancellor, this potentially means nine out of ten people buying a home this year won’t pay any stamp duty.
- Energy efficiency
To help both benefit the environment and “create green jobs”, homeowners and landlords will be able to apply for vouchers of up to £5,000 (up to £10,000 for households with lower incomes) to make their homes more energy efficient in 2020 and 2021. For example, making ‘green improvements’ such as loft, wall or floor insulation. There’s up to £2 billion available. There’s also £1 billion available to make public sector buildings more energy efficient.
We know our members need more than just these measures and we continue to campaign for Government changes to the Bounce Back Loan Scheme so we can help by supplying these loans.
As we get more information from the Government about the initiatives announced today, we’ll post updates.