Summer Financial Statement – Key Points
The Key points of the Summer Financial Statement from Rishi Sunak.
Please note: Further detail will be added as available and Scottish exceptions added.
The furlough scheme will wind down flexibly and gradually until the end of October, Sunak confirms.
“Leaving the furlough scheme open forever gives people false hope that it will always be possible to return to the jobs they had before,” says the chancellor.
A jobs retention bonus will help to wind down the scheme: businesses will be paid £1,000 to retain furloughed staff. This would cost the Treasury more than £9bn if every job furloughed is protected, Sunak says.
Sunak announces the “kickstart” job creation scheme for young people. The government will pay the wages of new young employees for six months.
There will be an initial £2bn to fund hundreds of thousands of jobs. Sunak says there will be no cap on the number of places available.
Training and jobs
Jobcentre work coach numbers will be doubled, the chancellor says.
Apprenticeships will be supported by bonuses for companies. Firms will get a payment of £2,000 for each apprentice they take on. Companies taking on apprentices aged over 25 will be given £1,500.
Sunak says the government wants a “green recovery with concern for our environment at its heart”.
As previously announced, the government 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 out of a £2bn pot to retrofit homes with insulation, helping to cut carbon emissions.
£1bn will be allocated to make public buildings greener.
The chancellor announces he will cut stamp duty to reinvigorate the housing market.
The threshold for stamp duty will increase from £125,000 to £500,000. The cut will be temporary, running until 31 March 2021, and will take effect immediately.
VAT cut for hospitality
Sunak says 2 million people work in the hospitality sector and that it has been one of the hardest hit by Covid-19, warranting further support from the government.
VAT will be cut from the current rate of 20% to 5% for the next six months on food, accommodation and attractions. The cut lasts from Wednesday 8 July until 12 January 2021.
Sunak says the move is a £4bn catalyst, benefiting more than 150,000 businesses and consumers.
Discounts on eating out
The chancellor announces an “eat out to help out discount” to encourage consumers to spend at restaurants and cafes.
Meals eaten at any participating businesses, from Mondays to Wednesdays, will be 50% off up to a maximum discount of £10 per head for everyone, including children.
Businesses will be able to register through a website launching on Monday. Firms can claim money back to have money in their bank accounts within five working days.
Sunak says 1.8 million people work in the industry, whose jobs can be supported. “We can all eat out to help out,” he adds.
Source: UK Guardian