Trade unions and the TUC have written to the Chancellor calling on him to use his spring statement to introduce ‘emergency support’ in response to the conflict in Ukraine.
This includes measures to support Ukrainian refugees, ensure that sanctions are effective, and protect UK families from the impact of rising energy prices.
The TUC has condemned the invasion of Ukraine, expressed its solidarity with the Ukrainian people, and called on governments to pursue all diplomatic efforts towards peace.
The letter from the TUC and unions says that the Chancellor must now step up with new financial measures to both support the Ukrainian people, and respond to the impact of the conflict on the cost-of-living crisis in the UK.
The letter calls on the Chancellor to:
Ensure that sanctions are effective by increasing enforcement funding for measures in the economic crime bill that would crack down on money-laundering in the UK; and consider a 100 per cent windfall tax on the profits of companies still invested in Russian state enterprises.
Provide safe routes to the UK for those fleeing the conflict, and scrap legislation plans that would close the door on all people fleeing war and threats to their lives.
Fund wider humanitarian assistance for displaced people, including essential medical supplies.
Protect working families against further energy price rises as a result of the crisis, by giving grants rather than loans to recued energy bill, increasing the warm homes discount, increasing universal credit, and accelerating a home energy efficiency retrofit programme.
The letter also calls on the government to ensure that those working in supply chains are protected from disruption, including by considering the use of a short-time working scheme.
TUC General Secretary Frances O’Grady said: “Trade unions condemn the illegal invasion of Ukraine. We know that working people in Ukraine, Russia and across Europe want peace. The UK government must pursue all diplomatic efforts to achieve that goal.
“The Chancellor must use his spring statement to act too. That means ensuring that sanctions are more effective, with funding to crack down on money-laundering in the UK. And he should fund greater humanitarian assistance for Ukrainians, including safe passage for those fleeing the war.
“Working people in the UK will need protection from even steeper hikes in gas bills from the conflict. The Chancellor should introduce grants to help with energy prices, roll out an emergency programme of home insulation, and fund it with a windfall tax on excess energy profits.”
“The government must provide safe routes to the UK for those escaping conflict. And ministers should scrap their Nationality and Borders Bill, which will close the door to people fleeing war and threats to their lives.”
Full text of the letter to the Chancellor:
Dear Chancellor
Protecting working people from the impact of the invasion of Ukraine
The trade union movement is united in its condemnation of Russia’s illegal invasion of a sovereign nation. Our solidarity is with the working people of Ukraine. Working people always suffer in conflict and the pursuit of peace is a fundamental trade union value, an essential condition to secure safety, social justice and workers’ and human rights.
The UK government must now take further action to support and strengthen international efforts to impose significant and effective sanctions on Russia and to support all diplomatic efforts towards peace. And it must play its part in supporting humanitarian assistance for forcibly displaced people and welcoming refugees seeking to come to the UK.
The government must also ensure that it takes every step possible to protect working people here at home from the impact of the conflict and measures taken in response to this. We urge you to use your forthcoming budget to act. We call on you to:
Target sanctions on wealthy elites linked to the Russian government – and ensure they are effective. We welcome the proposed register of overseas owners of UK property through the Economic Crime (Transparency and Enforcement) Bill, but this needs to be backed up by sufficient powers and funding for Companies House to enforce.
Fund humanitarian assistance for displaced people, and welcome refugees to the UK. The new Ukrainian visa proposals are inadequate and fall well short of what is needed. Limiting asylum to Ukrainian immediate family members of those already settled in the UK will not reassure Ukrainians fleeing war and bloodshed that they will be able to seek sanctuary in our country. The government must establish a safe route, so all Ukrainian families, who through no fault of their own have been forced from their homes, can easily apply for a humanitarian visa to travel to the UK. The Nationality and Borders Bill must be scrapped. Thousands of Ukrainians fleeing war may try to find sanctuary in the UK. If the Bill is passed many of these Ukrainians, along with others around the world fleeing conflict, threats to their lives and seeking safety may find themselves treated as criminals and deported, instead of being offered sanctuary.
Protect working families against rising gas prices, by raising funds through a windfall tax on energy profits and a new tax on profits made by UK companies invested in Russian state businesses. The current energy price crisis is hitting workers hard, and prices are likely to rise further. Government should implement existing TUC calls for:
Support for households in the form of a grant, not a loan (replacing the energy price rebate proposed by the government).
An increase in the warm homes discount, and a permanent increase in Universal Credit.
Rapid implementation of an accelerated and expanded domestic home retrofit programme, delivered by local councils who are best placed to deliver fast
Funding for these measures by the implementation of a windfall tax on north sea oil and gas companies.
An immediate increase in the national minimum wage to at least £10 an hour and a strategy to protect pay across the economy, including public services.
In addition, the government should consider implementing a new 100 per cent tax on additional profits made by UK based companies from their shareholdings in Russian state-backed enterprises that have profited from the gas price crisis. For example, this includes profits made by oil companies Shell and Vitol from their shareholdings in oil and gas fields in Russia in joint ventures with state-controlled companies Rosneft and Gazprom.
Protect jobs in supply chains now and build future supply chain resilience. Forcompanies sourcing parts and supplies from Russia, sanctions could have a significant impact. To protect jobs, the UK government should:
Re-introduce the furlough scheme or a permanent short-time working scheme in order to allow companies to protect jobs while they seek to shift their supply chains.
Begin an urgent programme to provide investment support to help companies to invest in UK supply chains and jobs.
Trade union leaders would be happy to meet you to discuss these issues, and the steps we must take now to support working people in Ukraine and in the UK,
Yours sincerely
Frances O’Grady, General Secretary, TUC
Sue Ferns, President, TUC
Christina McAnea, General Secretary, UNISON
Sharon Graham, General Secretary, Unite
Gary Smith, General Secretary GMB
Kevin Courtney and Mary Bousted, Joint General Secretaries, NEU
Paddy Lilis, General Secretary, Usdaw
Patrick Roach, General Secretary, NASUWT
Dave Ward, General Secretary, CWU
Mark Serwotka, General Secretary, PCS
Mike Clancy, General Secretary, Prospect
Ged Nichols, General Secretary, Accord
Ukraine: what you can do to help
Everyone wants to do their bit to support those who have been forced to flee their homes because of the invasion. Here is how you can help.
Financial donations
If you want to donate money, there are a number of charities providing humanitarian relief in Ukraine.
The UK Government will match public donations to this appeal pound-for-pound up to £25 million.
Make your donation safely
There are lots of organisations across the UK and internationally who have launched appeals, and you may wish to donate through these organisations instead. There are some simple steps you can take to ensure your money is safe and being used effectively:
Most charities with an income of £5,000 or more must be registered, which means they are regulated by The Charity Commission
Make sure the charity is genuine before giving any financial information
If in doubt, ask the charity or organisation for more information
Donating essential supplies
One of the best ways to help is by donating cash through trusted charities and aid organisations, rather than donating goods. Cash can be transferred quickly to areas where it is needed and individuals and aid organisations can use it to buy what is most needed. Unsolicited donations of goods, although well-meant, can obstruct supply chains and delay more urgent life-saving assistance from getting through.
Organisations across the UK are gathering essential supplies, such as clothes, first aid and sanitary products. Many charities and community groups will have lists of items they need.
Charities with experience of responding to disasters are best placed to reach victims on the ground.
Apply to be a sponsor
The government will be launching a new sponsorship scheme to make sure that Ukrainians who have been forced to flee their homes have a route to safety.
The scheme will match people, charities, businesses and community groups to Ukrainians who do not have family ties to the UK.
The UK Government, Ukrainian Government and others have been sharing messages of support on social media using the hashtag #StandForUkraine
Take care what you share! There is a lot of false information about the conflict circulating online – this is often called misinformation and disinformation. You can do your part to stop the spread:
Ask yourself – does this look right? Does this sound right? Does this information come from a source I recognise?
The SHARE checklist can help you decide if information can be trusted, before you interact with or share it on your social media channels
Cyber security
The National Cyber Security Centre is not aware of any specific cyber threats to the UK in relation to the Russian invasion of Ukraine. However we strongly encourage organisations and citizens to follow NCSC guidance on steps to take when the cyber threat is heightened.
Visit the Cyber Aware website where you find practical steps and tools to help keep you, your family or business more secure online.
Space industry pioneer and leading business executive Will Whitehorn has been appointed as the next Chancellor of Edinburgh Napier University.
The Edinburgh-born President of industry group UKspace takes up his post at the University on August 1, taking over from current Chancellor Dr David Eustace.
A former executive at the Virgin Group, Whitehorn also holds boardroom roles at The Scottish Gallery Employee Ownership Trust, Scottish Event Campus, Craneware, Good Energy and ÅAC Clyde Space AB. His business interests include travel, technology and communication as well as leadership, marketing and product design.
As Chancellor at Edinburgh Napier, he will become the titular head of the institution and will confer degrees and other awards of the University.
Educated at Edinburgh Academy and the University of Aberdeen, Whitehorn enjoyed watching aircraft at Edinburgh Airport as a youngster and spent his early career as a crewman on North Sea search-and-rescue helicopters.
After stints at Thomas Cook, TSB Group and Lombard Communications, he was recruited to Virgin to boost the Group’s image in the City, and became a key lieutenant to Sir Richard Branson. As Brand Development and Corporate Affairs Director, he was at the heart of the entertainment, media and travel giant’s relentless quest for new business opportunities.
Will Whitehorn worked on a series of major Virgin projects, including the Pendolino train, and later took up the post of President at Virgin Galactic, which saw him play a central role in developing the concept of commercial space travel.
After moving on from Virgin Galactic as it entered a new stage of development, he returned to brand and communications work, also holding board positions at Purplebricks, Stagecoach and Transport Systems Catapult.
Will Whitehorn, 61, said: “I am deeply honoured to have been chosen as the new Chancellor of this great University in the city I was born and raised in. I have a lot to thank Edinburgh for and I have a lot to thank my own good fortune for in achieving a place at the University of Aberdeen in 1977 and I never forget it. My career has been founded in my education.
“University should be an adventure and Edinburgh Napier does a better job of fulfilling that dream for students than many educational institutions around the country can even dream of and I feel privileged to have the opportunity to play my small part in taking the achievements of the University to new heights.
“But there are great challenges for education in Scotland in the political and economic minefields that lie ahead, and I am also mindful of the great responsibility I will also have in helping students and academics alike to navigate that future.”
Professor Andrea Nolan, Principal and Vice Chancellor at Edinburgh Napier University, said: “I am delighted that Will is taking on the role of Chancellor of Edinburgh Napier University.
“His exciting and varied business background will serve as inspiration to our students, who will be keen to engage with him on campus and find out what makes him tick as they set out to make their own mark on the world.
“His enthusiasm and passion for innovation and entrepreneurialism will equally inspire our staff, and all who align with our values. He will be a worthy successor to David Eustace, who brought deep commitment and energy to the role during his six years at the University.”
New 1% NHS pay offer is “a real terms pay cut” and “hammer blow to morale”, says union body
All key workers deserve a decent pay rise, says TUC
The TUC has released new analysis which shows how major groups of NHS workers will be much worse off in real terms in 2021-22 than in 2010.
The analysis shows that following the government’s decision to offer NHS staff a pay rise of just 1% in 2021-22, nurses’ pay will be down as much as £2,500 in real terms compared to a decade ago.
The picture is bleak for many other NHS staff too:
Porters’ pay will be down by up to £850
Maternity care assistants’ pay will be down by up to £2,100
Paramedics’ pay will be down by up to £3,330
Real terms pay loss since 2010
Occupation
Pay 2010
Pay 2010 in 20-21 prices (CPI)
Agenda for change 2020-21 pay
Pay 2021-22 (1% proposed increase)
Real terms pay loss 2010-2021
Porters
£16,753
£20,383
£19,337
£19,530
-£852
Medical secretaries
£18,577
£22,602
£21,142
£21,353
-£1,249
Nursery Nurse
£21,798
£26,521
£24,157
£24,399
-£2,122
Maternity Care Assistants
Speech and Language Therapy Assistants
Team coordinators
Nurses
£27,534
£33,500
£30,615
£30,921
-£2,579
Community nurses
Radiographer Specialist
£34,189
£41,597
£37,890
£38,269
-£3,328
Paramedic
Source: TUC analysis of NHS Agenda for Change Pay scales
The TUC analysis also reveals that NHS workers across many occupations and pay bands will suffer a real-terms pay cut in 2021-22.
For example, an experienced nurse or midwife (NHS band 5) will a face an annual real-terms pay cut of up to £153 in 2021-22 as a result of the planned 1% increase.
Unions have described the latest pay offer to NHS workers as an insult to their hard work and dedication during the pandemic.
TUC General Secretary Frances O’Grady said: “Our brilliant NHS workers have put their lives on their line to get Britain through this pandemic.
“It’s time we cared for them the way they have cared for us.
“That means giving them the decent pay rise they deserve – not a pathetic 1% increase. After years of real-terms pay cuts the government’s latest offer is a hammer blow to staff morale.
“This boils down to political choices. Ministers have chosen to spend hundreds of millions on outsourcing our failed test and trace system and on dodgy PPE contracts. But they have chosen not to find the money to give nurses, paramedics and other NHS workers fair pay.
“Boosting pay for NHS key workers will help our local businesses and high streets recover faster – because their customers will have more cash to spend. And that will help other workers get a pay rise too.”
BACKLASH
Four major unions – the BMA, the Royal College of Nursing, the Royal College of Midwives and UNISON – have written an open letter to the Chancellor, expressing their dismay at the 1% pay offer made to health workers.
In the letter they ask him to reconsider the recommendation, made to the NHS pay review bodies yesterday, that NHS staff receive a 1% pay rise.
The letter goes on to say: “The proposal of a 1% pay offer, not announced from the despatch box but smuggled out quietly in the days afterwards, fails the test of both honesty and fails to provide staff who have been on the very frontline of the pandemic the fair pay deal they need.
“Our members are the doctors, nurses, midwives, porters, healthcare assistants and more, already exhausted and distressed, who are also expected to go on caring for the millions of patients on waiting lists, coping with a huge backlog of treatment as well as caring for those with COVID-19.”
The unions make clear that the Government should demonstrate that it recognises the contribution of the hundreds of thousands of workers who have literally kept the country alive for the past year and call upon the Chancellor to, “make the right choice”.
Businesses in the retail, hospitality and leisure sectors are to receive a one-off grant worth up to £9,000, the Chancellor has announced.
Chancellor announces one-off top up grants for retail, hospitality and leisure businesses worth up to £9,000 per property to help businesses through to the Spring
£594 million discretionary fund also made available to support other impacted businesses
comes in addition to £1.1 billion further discretionary grant funding for Local Authorities, Local Restriction Support Grants worth up to £3,000 a month and extension of furlough scheme
This follows the Prime Minister’s announcement last night that these business will be closed until at least February half-term in order to help control the virus, and, together with the wide range of existing support, provides them with certainty through the Spring period.
The cash is provided on a per-property basis to support businesses through the latest restrictions, and is expected to benefit over 600,000 business properties, worth £4 billion in total across all nations of the UK.
Chancellor Rishi Sunak said: “The new strain of the virus presents us all with a huge challenge – and whilst the vaccine is being rolled out, we have needed to tighten restrictions further.
“Throughout the pandemic we’ve taken swift action to protect lives and livelihoods and today we’re announcing a further cash injection to support businesses and jobs until the Spring.
“This will help businesses to get through the months ahead – and crucially it will help sustain jobs, so workers can be ready to return when they are able to reopen.”
A further £594 million is also being made available for Local Authorities and the Devolved Administrations to support other businesses not eligible for the grants, that might be affected by the restrictions. Businesses should apply to their Local Authorities.
The new one-off grants come in addition to billions of existing business support, including grants worth up to £3,000 for closed businesses, and up to £2,100 per month for impacted businesses once they reopen.
The government has also provided 100% business rates relief for retail, hospitality and leisure businesses, £1.1 billion existing discretionary funding for Local Authorities, the furlough scheme now extended to April and 100% government backed loans, extended until March.
Further information
the one-off top-ups will be granted to closed businesses as follows:
£4,000 for businesses with a rateable value of £15,000 or under
£6,000 for businesses with a rateable value between £15,000 and £51,000
£9,000 for businesses with a rateable value of over £51,000
business support is a devolved policy and therefore the responsibility of the devolved administrations, which will receive additional funding as a result of these announcements in the usual manner:
the Scottish Government will receive £375 million
the Welsh Government will receive £227 million
the Northern Ireland Executive will receive £127 million
this will contribute to the funding which has already been guaranteed by the UK Government, to continue to provide the devolved administrations the certainty they need to plan for their COVID-19 response in the months ahead
small businesses in the devolved administrations should also be able to benefit from other UK-wide measures in the government’s unprecedented package of support for business, including the various business lending schemes (where the repayment terms were made easier as part of the Winter Economy Plan), and the extension of the Self Employment Income Support Scheme
‘We have an economic plan that will protect the jobs and livelihoods of the British people wherever they live and whatever their situation’ – Chancellor Rishi Sunak.
Thank you, Mr Speaker,
And let me speak first to the people of Liverpool, Lancashire, South Yorkshire, and Greater Manchester, and indeed other areas moving into, or already living under, heightened health restrictions.
I understand your frustration. People need to know this is not forever.
These are temporary restrictions to help control the spread of virus.
There are difficult days and weeks ahead, but we will get through this, together.
People are not on their own.
We have an economic plan that will protect the jobs and livelihoods of the British people wherever they live and whatever their situation.
And just as we have throughout this crisis, we will listen and respond to people’s concerns as the situation demands.
And I make no apology for responding to changing circumstances.
And so today we go further.
Mr Speaker,
The Prime Minister was right to outline a balanced approach to tackling coronavirus:
Taking the difficult decisions to save lives and keep the R rate down, while doing everything in our power to protect the jobs and livelihoods of the British people.
The evidence is clear: a regional, tiered approach is the right way to control the spread of the virus.
My Right Honourable Friend the Chief Secretary yesterday set out for the House our economic support for businesses who are legally required to close under those new restrictions.
We’re providing billions of pounds of support for local authorities; a grant scheme for affected businesses worth up to half a billion pounds every month;
And, of course, we expanded the Job Support Scheme – with the government covering the cost of paying two thirds of peoples’ normal wages if their employer had been legally required to close.
And for areas in local alert level 3 we have made available over a billion pounds of generous up-front grants so that local authorities can support businesses, protect jobs and aid economic recovery, in a fair and transparent way.
That is our plan to support closed businesses.
But it is clear that even businesses who can stay open are facing profound economic uncertainty.
This morning, I met with business and union representatives, including those from the hospitality industry, to discuss the new restrictions.
Their message was clear: the impact of the health restrictions on their businesses is worse than they hoped.
They recognise the importance of the tiered restrictions in controlling the spread of the virus.
But a significant fall in consumer demand is causing profound economic harm to their industry.
It is clear that they, and other open-but-struggling businesses, require further support.
So, Mr Speaker, I am taking three further steps today.
First, I’m introducing a new grants scheme for businesses impacted by Tier 2 restrictions, even if they aren’t legally closed.
We will fund local authorities to provide businesses in their area with direct cash grants.
It will be up to local authorities to decide how best to distribute the grants giving them the necessary flexibility to respond to local economic circumstances.
But I’m providing enough funding to give every business premise in the hospitality, leisure and accommodation sectors a direct grant worth up to £2,100 – for every month Tier 2 restrictions apply.
And that’s equivalent to 70% of the value of the grants available for closed businesses in Tier 3. And crucially, I am pleased to confirm these grants will be retrospective.
Businesses in any area which has been under enhanced restrictions can backdate their grants to August.
I have been listening and engaging with colleagues around the House including but not only my Honourable Friends for Heywood and Middleton, Hyndburn, Penistone and Stockbridge, South Ribble, Burnley, Keighley, Cheadle, Leigh and Southport.
I’m pleased to confirm the backdating of the new grants means we are being more generous to businesses and places which have been under higher restrictions for longer.
Let no one say Mr Speaker this Government is not committed to supporting the people and businesses in every region and nation of the United Kingdom.
Second, to protect jobs, we are making the Job Support Scheme more generous for employers. If businesses are legally required to close, as we’ve already outlined, the Government will cover the full cost of employers paying people two thirds of their salary, where they can’t work for a week or more.
For businesses who can open, it is now clear that the impact of restrictions on them, particularly in the hospitality sector, is more significant than they had hoped.
So I am making two changes to the short time work scheme to make it easier for those businesses to keep staff on, rather than make them redundant.
First, under the original scheme, employees had to work for 33% of their normal hours.
Now, we will ask them to work only 20% of their hours.
Second, the employer contribution for the hours not worked will not be 33%, as originally planned, or even 20% as it is in the October furlough scheme – it will reduce to 5%.
And the scheme will apply to eligible businesses in all alert levels, so businesses that are not closed but face higher restrictions in places like Liverpool, Lancashire, South Yorkshire and Greater Manchester, as well as the devolved nations, will be able to access greater support.
These changes mean more employers can access the scheme and more jobs will be protected.
We have made this one of the most generous versions of a short time work scheme anywhere in the world.
It is better for businesses, better for jobs, and better for the economy.
Third, as we increase the contribution we’re making towards employees’ wages, I’m increasing our contribution to the incomes of the self-employed as well.
Today, we are doubling the next round of the self-employed income support from 20% to 40% of people’s incomes, increasing the maximum grant to £3,750.
So far, through this crisis, we have now provided over £13 billion of support to self-employed people.
Sole traders, small businesses and self-employed people are the dynamic entrepreneurial heart of our economy – and this government is on their side.
In conclusion, Mr Speaker,
A wage subsidy for closed businesses.
A wage subsidy for open businesses.
Cash grants of over £2,000 a month for Tier 2 businesses and up to £3,000 for closed businesses.
Support for local authorities.
Support for the self-employed.
Support for people’s jobs and incomes.
All on top of over £200 billion of support since March.
This is our plan: a plan for jobs, for businesses, for the regions, for the economy, for the country; a plan to support the British people.And I commend this statement to the House.
Chancellor of the Exchequer Rishi Sunak’s Summer Statement speech to the House of Commons this afternoon:
Mr Speaker,
I stood here in March saying I knew people were worried. And I know they’re worried still.
We have taken decisive action to protect our economy.
But people are anxious about losing their job, about unemployment rising. We’re not just going to accept this.
People need to know we will do all we can to give everyone the opportunity of good and secure work.
People need to know that although hardship lies ahead, no one will be left without hope.
So, today, we act, with a Plan for Jobs.
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.
Where problems emerge, we will confront them.
Where support is justified, we will provide it.
Where challenges arise, we will overcome them.
We entered this crisis unencumbered by dogma and we continue in this spirit, driven always by the simple desire to do what is right.
Mr Speaker,
Before I turn to our Plan for Jobs, let me first outline the nature of the challenge.
Our economic response to coronavirus is moving through three phases.
In the first phase, beginning in March, the government announced social distancing measures and ordered businesses to close, halting the spread of the disease.
We put in place one of the largest and most comprehensive economic responses in the world.
Our £160 billion plan protects people’s jobs, incomes and businesses:
we supported more than 11 million people and jobs through the job retention and self-employment schemes, alongside billions of pounds for the most vulnerable
we supported over a million businesses to protect jobs, through tax cuts, tax deferrals, direct cash grants, and over a million government-backed loans
and we supported public services, with new funding for the NHS, schools, public transport, and local authorities
In total, we have now provided £49 billion to support public services since this crisis began.
Analysis I’m publishing today shows our interventions significantly protected people’s incomes, with the least well off in society supported the most.
And this crisis has highlighted the special bond which holds our country together.
Millions of people in Scotland, Wales and Northern Ireland have been protected by the UK government’s economic interventions – and they will be supported by today’s Plan for Jobs.
No nationalist can ignore the undeniable truth: this help has only been possible because we are a United Kingdom.
Mr Speaker,
Four months on, as we carefully reopen our economy, we are entering the second phase of our economic response.
Despite the extraordinary support we’ve already provided, we face profound economic challenges:
world economic activity has slowed, with the IMF expecting the deepest global recession since records began
household consumption – the biggest component of our economy – has fallen steeply
businesses have stopped trading and stopped hiring
taken together, in just two months our economy contracted by 25% – the same amount it grew in the previous eighteen years.
And the independent Office for Budget Responsibility and Bank of England are both projecting significant job losses – the most urgent challenge we now face.
I want every person in this House and in the country to know that I will never accept unemployment as an unavoidable outcome.
We haven’t done everything we have so far just to step back now and say, ‘job done’. In truth, the job has only just begun.
Mr Speaker,
If the first phase of our economic response was about protection…
…and the second phase – the phase we are addressing today – is about jobs…
…there will come a third phase, where we will rebuild.
My Right Honourable Friend the Prime Minister has set out our vision to level up, unite the country, spread opportunity, and repair and heal the wounds exposed through this crisis.
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.
In other words, our Plan for Jobs will not be the last action – it is merely the next – in our fight to recover and rebuild after coronavirus.
Mr Speaker, Let me now turn to the detail of our plan for jobs.
Central to our economic response has been the Jobs Retention Scheme.
Furlough has been a lifeline for millions, supporting people and businesses to protect jobs. But it cannot and should not go on forever.
I know that when furlough ends it will be a difficult moment. I’m also sure that if I say the scheme must end in October, critics will say it should end in November. If I say it should end in November, critics will just say December.
But the truth is: calling for endless extensions to the furlough is just as irresponsible as it would have been, back in June, to end the scheme overnight.
We have to be honest.
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 … least of all those trapped in a job that can only exist because of a government subsidy.
So the furlough will wind down, flexibly and gradually, supporting businesses and people through to October.
But while we can’t protect every job, one of the most important things we can do to prevent unemployment is to get as many people as possible from furlough back to their jobs.
So, today, 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 someone back who was furloughed – and you continuously employ them through to January – we will pay you a £1,000 bonus per employee.
It is vital people aren’t just returning for the sake of it – they need to be doing decent work.
So for businesses to get this bonus, the employee must be paid at least £520 on average, in each month from November to January the equivalent of the lower earnings limit in National Insurance.
The House should understand the significance of this policy. We will pay the bonus for all furloughed employees.
So if employers bring back all nine million people who have been furloughed, this would be a £9 billion policy to retain people in work.
Our message to business is clear: if you stand by your workers, we will stand by you.
Mr Speaker, The furlough was the right policy to support people through the first phase of this crisis.
But now, in this new phase, we need to evolve our approach.
Today, I want to set out for the House a new three-point plan for jobs.
We need to:
first – support people to find jobs
second – create jobs
and third – protect jobs
Mr Speaker,
Let me start with supporting jobs, and in particular the help we want to provide for those who will be hardest hit by this crisis: younger people.
Over 700,000 people are leaving education this year.
Many more are just starting out in their careers.
Coronavirus has hit them hard – under 25s are two and a half times as likely to work in a sector that has been closed.
We cannot lose this generation, so today, I am announcing the Kickstart Scheme:
A new programme to give hundreds of thousands of young people, in every region and nation of Britain, the best possible chance of getting on and getting a job.
The Kickstart Scheme will directly pay employers to create new jobs for any 16 to 24-year-old at risk of long-term unemployment.
These will be new jobs – with the funding conditional on the firm proving these jobs are additional.
These will be decent jobs – with a minimum of 25 hours per week paid at least the National Minimum Wage.
And they will be good quality jobs – with employers providing Kickstarters with training and support to find a permanent job.
If employers meet these conditions, we will pay young people’s wages for six months, plus an amount to cover overheads.
That means, for a 24-year-old, the grant will be around £6,500.
Employers can apply to be part of the scheme from next month, with the first Kickstarters in their new jobs this autumn.
And I urge every employer, big or small, national or local, to hire as many Kickstarters as possible.
Today, I’m making available an initial £2 billion; enough to fund hundreds of thousands of jobs.
And I commit today: there will be no cap on the number of places available.
We can do more for young people:
traineeships are a proven scheme to get young people ready for work. We know they work, so for the first time ever we will pay employers £1,000 to take on new trainees, with triple the number of places
to support 18-19-year olds leaving school or college to find work in high-demand sectors like engineering, construction and social care, we’ll provide £100 million to create more places on Level 2 and 3 courses
and the evidence says careers advice works, so we will fund it, with enough new careers advisers to support over a quarter of a million more people.
We will also expand our universal skills offer:
Sector-Based Work Academies provide training, work placements, and a guaranteed job interview in high-demand sectors.
The evidence shows they work, so we will expand them – tripling the number of places.
And we know apprenticeships work, too – 91% of apprentices stay in work or do further training afterwards.
So for the next six months, we’re going to pay employers to create new apprenticeships.
We will pay businesses to hire young apprentices, with a new payment of £2,000 per apprentice.
And we will introduce a brand-new bonus for businesses to hire apprentices aged 25 and over, with a payment of £1,500.
And let me thank my Right Honourable Friend the Education Secretary for his support and commitment in developing these measures.
Mr Speaker,
We know the longer someone is out of work, the harder it is to return. Millions of people are moving onto Universal Credit – they need urgent support to get back to work.
So, we are:
doubling the number of Work Coaches in Job Centres
increasing the Flexible Support Fund
extending the Rapid Response Service
expanding the Work and Health Programme
and developing a new scheme to support the long-term unemployed
The academic and economic evidence tells us these are among the most effective things we can do.
So I’m investing an extra billion pounds in DWP, to support millions of people back to work.
And I’m grateful for everything my Right Honourable Friend the Work and Pensions secretary, and her incredible team, have done.
£1 billion of support for the unemployed; more money for skills, traineeships, and apprenticeships; and a new, good quality job for hundreds of thousands of new Kickstarters – the first part of our plan for jobs.
Mr Speaker,
The second part of our plan is to support job creation.
That begins with historic investment in infrastructure – creating jobs in every region and nation of the UK.
At Budget, I announced £88 billion of capital funding this year; and last week the Prime Minister announced our plans to accelerate £5 billion of additional investment projects.
We are doubling down on our ambition to level up…
…with better roads, better schools, better hospitals, better high streets, creating jobs in all four corners of our country.
Mr Speaker, As well as investing in infrastructure, we want to create green jobs.
This is going to be a green recovery with concern for our environment at its heart.
As part of that, I’m announcing today a new, £2 billion 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.
The grants will cover at least two thirds of the cost, up to £5,000 per household.
And for low income households, we’ll go even further with vouchers covering the full cost – up to £10,000.
On top of the £2 billion voucher scheme, I am releasing £1 billion of funding to improve the energy efficiency of public sector buildings…
…alongside a £50 million fund to pilot the right approach to decarbonise social housing.
Taken together, we expect these measures to:
make over 650,000 homes more energy efficient
save households up to £300 a year on their bills
cut carbon by more than half a mega tonne per year, equivalent to taking 270,000 cars off the road
and, most importantly right now, support around 140,000 green jobs
A £3 billion green jobs plan to save money; cut carbon; and create jobs.
Mr Speaker, One of the most important sectors for job creation is housing.
The construction sector adds £39 billion a year to the UK economy;
House building alone supports nearly three quarter of a million jobs;
With millions more relying on the availability of housing to find work.
But property transactions fell by 50% in May.
House prices have fallen for the first time in eight years.
And uncertainty abounds in the market – a market we need to be thriving.
We need people feeling confident – confident to buy, sell, renovate, move and improve.
That will drive growth. That will create jobs.
So to catalyse the housing market and boost confidence, 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 next year.
And, as is always the case, these changes to stamp duty will take effect immediately.
The average stamp duty bill will fall by £4,500.
And nearly nine out of ten people buying a main home this year, will pay no stamp duty at all.
Stamp duty cuts; A £5,000 Green Homes Grant; And tens of billions of pounds of new capital projects.
We are creating jobs, the second part of our Plan for Jobs.
Mr Speaker, The final part of our plan will protect jobs that already exist by helping some of our highest-employing but hardest-hit sectors: hospitality and tourism.
Our economy relies on consumption, especially social consumption:
The pubs, cafes, restaurants, hotels and B&Bs that bring life to our villages, towns and cities.
Taken together these sectors employ over 2 million people disproportionately younger, women and people from Black, Asian and minority ethnic communities.
And many rural and coastal communities rely on these industries.
80% of hospitality firms temporarily stopped trading in April and 1.4 million workers have been furloughed, the highest proportions of any sector.
So the best jobs programme we can do is to restart these sectors and get our pubs, restaurants, cafés and B&Bs bustling again.
I know people are cautious about going out.
But we wouldn’t have lifted the restrictions if we didn’t think we could do so safely.
And I’ve seen in the last few weeks how hard businesses are working to make their premises safe.
And if we follow the guidance, and respect what they ask us to do, we can all enjoy summer safely.
In turn, we need to give these businesses the confidence to know that if they open up, invest in making their premises safe, and protect jobs, demand will be there, and be there quickly.
So today, I’m announcing two new measures to get these sectors moving and protect jobs.
First, 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%.
This is a £4 billion catalyst for the hospitality and tourism sectors, benefiting over 150,000 businesses, and consumers everywhere – all helping to protect 2.4 million jobs.
But, Mr Speaker, we will go further. The final measure I’m announcing today has never been tried in the UK before. This moment is unique. We need to be creative.
So, to get customers back into restaurants, cafes and pubs, and protect the 1.8 million people who work in them, I can announce today that, 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.
Businesses will need to register, and can do so through a simple website, open next Monday.
Each week in August, businesses can then claim the money back, with the funds in their bank account within 5 working days.
1.8 million people work in this industry. They need our support and with this measure we can all eat out to help out.
A VAT cut to 5%;
And a first-of-its-kind government-backed discount for all;
That’s the third part of our Plan for Jobs.
So, Mr Speaker,
A £1,000 Jobs Retention Bonus.
New, high quality jobs for hundreds of thousands of young Kickstarters.
£1bn to double the number of work coaches and support the unemployed.
More apprenticeships; more traineeships; more skills funding.
Billions of pounds for new, job creation projects around the country.
A £3 billion plan to support 140,000 green jobs.
And in this vital period, as we get going again:
VAT cut.
Stamp duty cut.
Meals out cut.
Mr Speaker, all part of our Plan for Jobs worth up to £30 billion.
Mr Speaker,
Governments, much less people, rarely get to choose the moments that define them. What choice there is comes in how we respond.
For me, this has never just been a question of economics, but of values:
I believe in the nobility of work.
I believe in the inspiring power of opportunity.
I believe in the British people’s fortitude and endurance.
And it is that value, endurance, more than any other, we need to embody now.
A patience to live with the uncertainty of the moment…
…to find that new balance between safety and normality.
We will not be defined by this crisis, but by our response to it.
It is an unambiguous choice to make this moment meaningful for our country in a way that transcends the frustration and loss of recent months.
It is a plan to turn our national recovery into millions of stories of personal renewal.
Mr Speaker, it is our Plan for Jobs and I commend it to this House.
Anneliese Dodds MP, Labour’s Shadow Chancellor, responding to the Government’s ‘Plan for Jobs’, said:“Labour has repeatedly called on the government to match the ambitions of Labour’s Future Jobs Fund, to rise to the youth unemployment challenge.
“To the extent that the ‘Kickstart’ programme is based on the Future Jobs Fund model, it should help many young people to access work.
“However, the Government are yet to rise to the scale of the unemployment crisis. The urgent priority right now is to prevent additional unnecessary unemployment in the first place by abandoning the Government’s ‘one-size-fits-all’ approach to the removal of the Job Retention and Self-Employed schemes.
“In addition, older people who become unemployed, and those living in particularly hard-hit areas, will also need tailored support.
“Government also urgently needs to get test, track and isolate right, as ultimately the biggest drag on our economy has been the slow public health response, which threatens additional localised lockdowns and which has reduced consumer confidence.”
Responding the UK Chancellor’s Summer Statement today, Finance Secretary Kate Forbes said: “We called for an £80bn stimulus package to build a strong, green and inclusive economic recovery and while there are elements in this announcement to be welcomed, in particular the measures on VAT for tourism and hospitality, overall this package is a huge opportunity missed. It falls well short of delivering what is needed to boost the economy and protect jobs.
“There is no new capital spend, no extension to the furlough scheme for hard-hit sectors and no further support for households in financial difficulty. A half price meal out does not help those struggling to put food on the table.
“Many of the initiatives are short-lived and do not provide long term certainty for business or households. Instead they will simply push the problems back to the end of the year when we will also have to deal with the end of the transition period with the EU.
“Despite announcing new funding measures worth up to £30bn today, most of it bypasses devolution and does not provide the Scottish Government with the funding we need to enable us to tailor an economic response that meets Scotland’s needs.
“Like all governments, we are facing huge spending pressures but we do not have the tools that others have to meet them. Along with the Governments of Wales and Northern Ireland, we set out a reasonable, proportionate set of new financial powers that would enable the Scottish Government to respond effectively. Regrettably, the UK Government has turned a deaf ear to those needs.”
Also responding to measures announced today by the chancellor in his summer statement, TUC General Secretary Frances O’Grady said: “Mass unemployment is now the biggest threat facing the UK, as shown by the thousands of job losses at British Airways, Airbus and elsewhere.
“The government must do far more to stem the rising tide of redundancies. We can’t afford to lose any more good skilled jobs.
“The chancellor should have announced targeted support for the hardest-hit sectors like manufacturing and aviation. Struggling businesses will need more than a one-off job retention bonus to survive and save jobs in the long-term.
“Unions campaigned for a job guarantee scheme. Kickstart is a good first step. But if the government allows vital industries to go the wall, unemployment will surge and the recession will last far longer.
“The more people we have in decent work, the faster we can work our way out of recession. We must create jobs through more new public investment in new homes, childcare, faster broadband, better transport and green tech.
“The government should have announced extra investment in jobs across all public services – starting with filling the 200,000 vacancies in the NHS and social care. And if the chancellor wants people to have the confidence to eat out, he should have announced a pay rise for hard-pressed key workers rather than dining out discounts for the well-off.”
On sick pay, Frances added: “The government missed an opportunity to strengthen their faltering Test and Trace programme.
“Statutory sick pay is too low for anyone to live on. It’s not viable to ask people to self-isolate if they will be pushed into financial hardship.
“We had hoped ministers would listen, raise the rate and change the rules so low-paid people could afford to do the right thing and comply with self-isolation. Once again, this government fails to understand the real lives of low-paid workers. It is clear that poverty wages and insecure contracts are a public health hazard.”
As the Chancellor stands up to make his ‘summer statement’ today, families across the country will be facing up to the possibility of unemployment (writes the TUC’s KATE BELL):
The Chancellor has a chance to prevent the devastation of mass unemployment leading to the situation this country saw in the 1980s – young people left on the scrap heap, lives ruined, and communities decimated. But he needs to act fast and decisively.
Here’s the TUC’s plan for decent jobs:
1. Introduce a real jobs guarantee – offering paid jobs for young people who face unemployment
We’ve heard that the Chancellor may invest in apprenticeships, or traineeships – unpaid work placements with some training attached. It’s not clear yet whether these will be voluntary, or how the Chancellor expects people to live while they’re undertaking these. The TUC has always opposed mandatory unpaid work placements. And unpaid work experience is no substitute for a real jobs guarantee.
We want the government to invest in supporting real jobs, paid at least the Real Living Wage, for young people facing the prospect of long-term unemployment. Government funding should support additional jobs in the public and private sector that support regional growth strategies, and provide real benefit, including helping to decarbonise the economy.
That jobs guarantee must go alongside a rapid redundancy response service and investment in jobcentres. And we desperately need an increase in social security payments to stop those who lose their jobs spiralling into debt.
2. Invest across the economy to create jobs
We know the country needs an infrastructure upgrade to help drive productivity, and urgent action to tackle the climate crisis. And after a decade of austerity, our public services are desperately overstretched.
Fixing these problems now can help create the jobs we need. Research for the TUC shows that an £85bn investment in green infrastructure could help create 1.24 million jobs in the next two years, including 500,000 jobs through building and retrofitting social housing, and almost 60,000 jobs in electrifying transport.
And we should support our public services by investing in jobs. There are over 100,000 vacancies in social care, and 100,000 more in the NHS – even before we deliver a better system. Local government saw 100,000 redundancies in the past decade, jobs that are needed now to deliver vital services and help tackle the pandemic.
3. Work with unions and business on new rescue plans for hard hit sectors
We’ve seen how the pandemic, and the social distancing measures it requires, has hit some types of business harder than others. Aviation and hospitality have been particularly badly affected. Government needs to come together with unions and businesses to design rescue packages for these sectors – including setting out how those plans can be used to deliver better and greener jobs.
The Job Retention Scheme has done valuable work throughout the crisis in protecting people’s jobs, and is now supporting many people to work part-time. Government should extend it beyond October for businesses that can show they have a viable future but need more time to get back on their feet.
4. Prioritise progress towards equality
We know unemployment is bad for everyone. But those who already face discrimination in the labour market often see their prospects held back even further. BME groups faced higher unemployment in the 2008-09 recession, and still have high unemployment rates.
Research shows that during upturns disabled people are the last to gain employment, and during downturns they are first to be made unemployed. With the childcare sector on the brink of collapse, women’s employment prospects face being put back a generation.
The Chancellor needs to prioritise progress towards equality when he sets out his plans. That means tackling the insecure work that leaves BME workers disproportionately having their hours cut or being let go. It means monitoring the impact of employment programmes on different groups.
And it means the Chancellor needs to protect those who can’t work due to the fact they are shielding or have caring responsibilities from being forced out of work by extending the job retention scheme.
Mass unemployment and a new wave of inequality aren’t inevitable. We can build back better. But the Chancellor needs to be bold and act fast.
Finance Ministers from the devolved administrations are urging the UK Government to ease the financial restrictions imposed on devolved governments so they can better respond to the coronavirus (COVID-19) crisis.
Ahead of the Chancellor’s Summer Statement, Kate Forbes, Rebecca Evans and Conor Murphy are calling for assurances that will give them the freedom to switch capital funding to day-to-day revenue and put an end to the arbitrary limits on borrowing. They are also looking for more clarity on details around the forthcoming Spending Review.
Kate Forbes, Scotland’s Cabinet Secretary for Finance (above), said: “The powers we are seeking will enable the Scottish Government to respond to COVID-19 more effectively and reboot our economy. They are relatively limited powers, but would ease some of the immense pressures on our budget and give us more tools to kick-start our recovery.
“At the moment, any extra money spent bolstering services and supporting the economic recovery must be taken from other areas. That creates risks for our essential public services, jobs and businesses. I am therefore calling on the Chancellor to ease these rigid fiscal rules and give us the flexibility we need to properly address the monumental challenges our economy is facing.
“I also want to see greater ambition in the level of investment in our economy. Last week the Scottish Government set out a proposal for an £80 billion UK-wide stimulus package. What is needed at this time of crisis is bold and practical policies that will boost consumption, promote investment and protect jobs.”
Northern Ireland Finance Minister Conor Murphy said: “It is crucial that the devolved administrations are equipped to respond swiftly and effectively to the challenges arising from COVID-19.
“More financial flexibility can help us deal with these challenges and use our budgets to support public services, protect the vulnerable, and deliver an economic recovery.”
Welsh Finance Minister Rebecca Evans said: “Our response to the COVID-19 crisis has been hampered by UK imposed rules that limit our ability to get more resources to the frontline.
“There is no clear rationale for these rules, which undermine good budget management in Wales.
“The Welsh Local Government Association, Wales TUC, FSB Cymru and Institute for Fiscal Studies and, more recently, the Senedd’s Finance Committee, have all made the same calls for change.
“The crisis has made the issue urgent. It’s time for the UK Government to act and provide the flexibility we need to respond and invest in Wales’ recovery.”
The government’s Coronavirus Job Retention Scheme will remain open until the end of October, the Chancellor announced today.
Coronavirus Job Retention Scheme will continue until end of October
furloughed workers across UK will continue to receive 80% of their current salary, up to £2,500
new flexibility will be introduced from August to get employees back to work and boost economy
In a boost to millions of jobs and businesses, Rishi Sunak said the furlough scheme would be extended by a further four months with workers continuing to receive 80% of their current salary.
As we reopen the economy (at least in England – Ed.), we need to support people to get back to work. From the start of August, furloughed workers will be able to return to work part-time with employers being asked to pay a percentage towards the salaries of their furloughed staff.
The employer payments will substitute the contribution the government is currently making, ensuring that staff continue to receive 80% of their salary, up to £2,500 a month.
Chancellor Rishi Sunak said: “Our Coronavirus Job Retention Scheme has protected millions of jobs and businesses across the UK during the outbreak – and I’ve been clear that I want to avoid a cliff edge and get people back to work in a measured way.
“This extension and the changes we are making to the scheme will give flexibility to businesses while protecting the livelihoods of the British people and our future economic prospects.”
New statistics published today revealed the job retention scheme has protected 7.5 million workers and almost 1 million businesses.
The scheme will continue in its current form until the end of July and the changes to allow more flexibility will come in from the start of August. More specific details and information around its implementation will be made available by the end of this month.
The government will explore ways through which furloughed workers who wish to do additional training or learn new skills are supported during this period. It will also continue to work closely with the Devolved Administrations to ensure the scheme supports people across the Union.
The Chancellor’s decision to extend the scheme, which will continue to apply across all regions and sectors in the UK economy, comes after the government outlined its plan for the next phase of its response to the coronavirus outbreak.
The scheme is just one part of the government’s world-leading economic response to coronavirus, including an unprecedented package for the self-employed, loans and guarantees that have so far provided billions of pounds in support, tax deferrals and grants for small businesses.
Today the UK government is also publishing new statistics that show businesses have benefitted from over £14 billion in loans and guarantees to support their cashflow during the crisis.
This includes 268,000 Bounce Back Loans worth £8.3 billion, 36,000 loans worth over £6 billion through the Coronavirus Business Interruption Loan Scheme, and £359 million through the Coronavirus Large Business Interruption Loan Scheme.
Mike Cherry, National Chairman of the Federation of Small Businesses, said: “The Job Retention Scheme is a lifeline which has been hugely beneficial in helping small employers keep their staff in work, and it’s extension is welcome.
“Small employers have told us that part-time furloughing will help them recover from this crisis and it is welcome that new flexibility is announced today.
BCC Director General Adam Marshall said: “The extension of the Job Retention Scheme will come as a huge help and a huge relief for businesses across the UK.
“The Chancellor is once again listening to what we’ve been saying, and the changes planned will help businesses bring their people back to work through the introduction of a part-time furlough scheme. We will engage with the Treasury and HMRC on the detail to ensure that this gives companies the flexibility they need to reopen safely.
“Over the coming months, the government should continue to listen to business and evolve the scheme in line with what’s happening on the ground. Further support may yet be needed for companies who are unable to operate for an extended period, or those who face reduced capacity or demand due to ongoing restrictions.”
Dame Carolyn Fairbairn, CBI Director-General, said: “The Chancellor is confronting a challenging balancing act deftly. As economic activity slowly speeds up, it’s essential that support schemes adapt in parallel.
“Extending the furlough to avoid a June cliff-edge continues the significant efforts made already and will protect millions of jobs.
“Introducing much needed flexibility is extremely welcome. It will prepare the ground for firms that are reawakening, while helping those who remain in hibernation. That’s essential as the UK economy revives step-by-step, while supporting livelihoods.
“Firms will, of course, want more detail on how they will contribute to the scheme in the future and will work with government to get this right.
“Above all, the path of the virus is unpredictable, and much change still lies ahead. The government must continue to keep a watchful eye on those industries and employees that remain at risk. All schemes will need to be kept under review to help minimise impacts on people’s livelihoods and keep businesses thriving.
“The greater the number of good businesses saved now, the easier it will be for the economy to recover.”
Commenting on the extension of the government’s job extension scheme today, TUC General Secretary Frances O’Grady said: “We are pleased ministers have listened to unions and extended the job retention scheme to the autumn. This will be a big relief for millions.
“Changing the rules to allow part-time working is key to enabling a gradual and safe return to work. And maintaining the rate at 80% is a win for the pay packets of working families.
“As the economic consequences of Covid-19 become clear, unions will keep pushing for a job guarantee scheme to make sure everyone has a decent job.”
Anneliese Dodds MP, Labour’s Shadow Chancellor, said: “The furlough scheme is a lifeline for millions. The Government was right not to pull it away.
“It is welcome that the Chancellor has heeded the call by Labour, trade unions, and businesses for more flexibility in the scheme, to support employees to go back to work part-time.
“The government must clarify today when employers will be required to start making contributions, and how much they’ll be asked to pay. If every business is suddenly required to make a substantial contribution from the 1st August onwards, there is a very real risk that we will see mass redundancies.”
Extension to Furlough Scheme could cost the Government £70 billion
The Chancellor has extended the current Furlough scheme until the end of October but he now has a huge challenge to get this right, say leading tax and advisory firm Blick Rothenberg.
Heather Self a partner at the firm said: “He needs to achieve a “Goldilocks” effect – not too hot, and not too cold. If he provides too much it will be very expensive and may discourage firms from reopening. If he provides too little thousands of people could lose their jobs.
She added: “It is going to be a turbulent time for the labour market in the Autumn. Some sectors, such as the hospitality and tourism sector, are likely to see significant redundancies, while others such as construction and financial services will be relieved to see a gradual winding-down of support.
From the announcement today, we now know that:
– Support will be continued to the end of July in full, with employers required to contribute after that date.
– Part time working will be permitted, but only for some employees
– The same level of overall support – 80% of wages up to a maximum of £2500 a month – will be maintained
Heather said: ” As the furlough scheme is reduced the Government needs to incentivise business and come up with creative ideas about how business can keep going and retain staff.
“The Chancellor could not go on paying out billions of pounds indefinitely, and everyone understands that, but there needs to be much more joined up thinking between Government and business.”
So far, some 7.5m employees have been furloughed, at a cost approaching £10bn.
The expected costs to the end of July are likely to be around £50bn, with the extension at a reduced level to the end of October perhaps costing a further £20bn. These are very significant sums, amounting to around 10% of total Government receipts.
As Britain seeks to get back to work, the pressures on different sectors will be very uneven.
While some sectors, such as construction and financial services, are getting back to work, others such as leisure and hospitality will be much slower to recover.
And the position in the tourism and heritage sectors is likely to become critical if they lose the whole of the Summer season.
Heather Self said: “Enabling part time work is welcome, as it will permit a gradual return to work. But the Chancellor said this would only be available to businesses “currently using” the scheme – it is not clear what the cut-off date will be for businesses still considering whether they need to furlough employees.
“The Chancellor needs to pay attention to the needs of different sectors, difficult though this may be. Leisure and hospitality businesses are unlikely to be able to cope with reopening fully by the end of July, and may need to contemplate redundancies.
“Additional support beyond the furlough scheme will be needed for a long time – whether loans such as the CBILS scheme, or grants, or incentives such as an increase in the Employment Allowance to encourage employers to maintain their staff levels, or even take on new employees.”
Chancellor announces additional £300 BILLION to keep UK afloat
The Chancellor Rishi Sunak has announced unprecedented support for business and workers to protect against the economic emergency caused by the coronavirus.
This includes unlimited loans and guarantees to support firms and help them manage cashflows through this period. The Chancellor will make available an initial £330 billion of guarantees – equivalent to 15% of UK GDP – and there could be more to come.
At last week’s Budget, the Chancellor provided £30 billion of support to the economy to deal with the crisis by investing in public services, increasing support for vulnerable people and providing business with tax reliefs and loans.
He said he would take further action as the situation evolved and today outlines further measures, including:
To ensure that businesses have access to the funds they need, \the UK Government will provide:
support for liquidity amongst large firms, with a major new scheme being launched by the Bank of England to help them bridge Coronavirus disruption to their cash flows through loans
increasing the amount businesses can borrow through the Coronavirus Business Interruption Loan Scheme from £1.2 million to £5 million, and ensuring businesses can access the first 6 months of that finance interest free, as Government will cover the first 6 months of interest payments
including new legal powers in the Covid Bill enabling us to offer whatever further financial support we think necessary to businesses
Providing £20 billion of business rates support and grant funding to help the most-affected firms manage their cashflow through this period by:
giving all retail, hospitality and leisure businesses in England a 100% business rates holiday for the next 12 months
increasing grants to small businesses eligible for Small Business Rate Relief from £3,000 to £10,000
providing further £25,000 grants to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value over £15,000 and below £51,000
Mortgage lenders have agreed they will support customers that are experiencing issues with their finances as a result of Covid-19, including through payment holidays of up to 3 months. This will give people the necessary time to recover and ensure they do not have to pay a penny towards their mortgage in the interim.
Confirmation that government advice to avoid pubs, clubs and theatres etc. is sufficient for businesses to claim on their insurance where they have appropriate business interruption cover for pandemics in place.
To support the food industry and help provide meals for people who need to self-isolate, the UK government will relax planning regulations to allow pubs and restaurants to start providing takeaways without a planning application.
The Chancellor of the Exchequer Rishi Sunak said: “We will do whatever it takes to protect our people and businesses from the effects of this global economic emergency brought on by the Coronavirus pandemic.
“The interventions I am setting out today will help support businesses of all sizes – so they can continue operating during these unprecedented times.”
The action announced yesterday means that over £3.5 billion in additional funding will be provided to the devolved administrations for support to businesses in Scotland, Wales and Northern Ireland.
The Chancellor will expand on his plans to keep the economy afloat later today and an announcement of support for people who live in rented accommodation is expected this week.
Labour’s John McDonnell MP, Shadow Chancellor, responding to Chancellor Rishi Sunak’s coronavirus update, said: “People are being laid off today and losing their incomes. We are disappointed that this package does not address their concerns.
“The further announcements laid out by the Chancellor lack the certainty required amidst growing public anxiety and still do not go far enough in protecting workers, renters and those who are losing their jobs, or in fully supporting businesses at the scale necessary.
“In particular, the Chancellor’s claim that new forms of employment support will be developed does not appreciate the urgency and gravity of the situation. Workers and businesses need to know now that they will be supported, not in a few days’ time.
“Labour will continue to engage with the Government to ensure we have the proper scale of interventions required to secure proper funding of public services at the time of crisis, public control and oversight of those key services, a strong safety net, and the wellbeing of all.”
Gareth Shaw, Head of Money at Which?, said: “The measures announced by the chancellor, such as a three-month mortgage holiday scheme, are an important first step to helping millions of consumers who may face financial hardship during the coronavirus crisis.
“The government must move swiftly to ensure those in need of assistance get clear information about how these schemes will work in practice – and that the process for doing so is straightforward, ensuring consumers can easily access the support they need in the challenging months ahead.”
Responding to chancellor Rishi Sunak’s package of support for businesses and the prime minister’s pledge to do `whatever it takes’ to support people and jobs through the corona virus crisis, the head of the UK’s leading union, Unite, has said that his union stands ready to play their part throughout this time of crisis.
Len McCluskey, Unite’s general secretary said: “It is abundantly clear that we need a package of measures equal to the public health and economic emergencies now upon us.
“Urgent and considerable action is needed by government to avert personal and industrial catastrophe.
“Unite is pleased to have heard the prime minister and chancellor say very clearly that they `will do whatever it takes’ to protect public health and the economy’s health. We will hold them to that.
“However, we remain extremely concerned that workers’ and individuals’ own capacity to act on the public health advice will remain seriously compromised because the direct economic support has not yet been provided by government. This must change and urgently. Providing wage support and covering rents must be a priority.
“It is welcome that those hit by the virus will have a three month mortgage holiday should they need it, but what about the vast majority of people who rent? They need to know that they can put food on the table and keep a roof over their families’ heads. Only then will they feel able to play their part in tackling this public health emergency.
“We urgently need for the government to introduce now the sort of measures that we have seen implemented in our competitor nations, including paying workers 75 per cent plus of their salary while they are forced to be at home as has been introduced in Denmark and Holland. UK workers deserve the same efforts and assistance.”
