Tag: Economy

First Minister: Please, please stick to restrictions

Statement given by the First Minister Nicola Sturgeon at a media briefing in St Andrew’s House, Edinburgh, on Thursday, 30 April:

Good afternoon. Thanks for joining us for today’s briefing.

I want to start – as I always do – by updating you on some of the key statistics in relation to the spread of the virus in Scotland.

As of 9 o’clock this morning, there have now been 11,353 positive cases confirmed – that is an increase of 319 since yesterday.

A total of 1748 patients are currently in hospital with either confirmed or suspected cases of COVID-19 – that is an increase of 21 from yesterday.

A total of 109 people last night were in intensive care, again with either confirmed or suspected cases. That is a further decrease of 5 since yesterday.

I am also able to confirm today that since 5 March, a total of 2,538 patients who had tested positive for the virus and been admitted to hospital as a result, have now been able to leave hospital.

However, on a sadder note, I also have to report that in the last 24 hours, 60 deaths have been registered of patients who have been confirmed through a test as having the virus – that takes the total number of deaths in Scotland, under that measurement, to 1,475.

These numbers, as I stress every single day, are not just statistics. They represent people who are right now deeply missed by the friends, families and their wider network of loved ones. So once again, I want to send my deepest sympathies and condolences to everyone who has lost a loved one to this virus, we are all thinking of you at this time.

I also want to thank – as I always do – our health and care workers. At 8 o’clock this evening I will join with many others in applauding our health and care workers, in what I think has become a very precious and very special moment in the week.

And to health and care workers, I hope that this shows you, albeit in a symbolic way, just how grateful everybody across the country is for the extraordinary and very courageous work that all of you are doing.

There are two things I want to talk about today. First of all, I want to take the opportunity to emphasise the vital importance of sticking with the lockdown restrictions at this time.

I set out last week our decision making framework for starting – slowly and gradually – to ease aspects of the lockdown when it is safe to do so, and the factors and uncertainties we will have to take into account as we make these difficult decisions.

I promised to be open with you as our thinking and our decision making develops and I absolutely will be. I intend to update you again next week – ahead of the official review date of 7 May – on our considerations and judgements so far. I am very grateful to all of you have taken the time to send us views on the paper that we published a week ago today.

But part of the grown-up conversation I want to have involves me being willing, when necessary, to deliver tough messages as well as hopefully the more positive messages about how, when it is safe to do so, we can start the journey to what I described last week as a ‘new normal’, and start to reduce some of the harms to the economy and our well-being that we know the lockdown restrictions are having.

Right now, that means I have to be straight with you that it may very well be too early, even this time next week, in any meaningful way, to safely lift any of the current restrictions.

I want to share with you the reasons for that.

We have worked very hard as a country to bring down the transmission rate of this virus – and we are definitely seeing results from those efforts.

In fact we see that fewer people are now in intensive care than two weeks ago, and that figure appears to be reducing now on an ongoing basis, and hospital admissions, although they are fluctuating as you see today, are also on a slowly reducing curve.

Overall, we think that transmission in the community of the virus has been reduced very significantly as a result of the lockdown – although of course we know that it remains higher in settings such as care homes.

The R number which you hear us talk about – the rate at which the virus reproduces – is, we believe, now below 1. Remember, that at the start of lockdown, we think it was above 3. So that is real and very positive progress.

And that progress matters. With the R number below 1, that means every 100 people with the virus, between them pass it on to fewer than 100 more people and so on – and so the total number of cases will gradually decline.

We do think that is happening now. However we are not confident that the R number is very far below 1. That means any easing up at all in the current restrictions – either formally by government decisions, or informally by people becoming a bit less compliant as we all get more and more weary and frustrated – would quickly send it back above 1. Indeed, there have been reports in the last day or so from Germany that their R number is rising again as a slight easing up there has been taking effect.

And if the R number does go back above 1 – let’s say it goes to even 1.5 – then our 100 people from a moment ago would between them transmit the virus to 150 people, they in turn pass it on to 220 people and so on and so on, and suddenly the virus is spreading exponentially again.

That would mean more people in hospital and in intensive care and even more people dying.

So the point I am making today is not an easy one, but it is an essential one. The progress we have made is real and it is significant, but it is still very fragile. The margins we have for ensuring the virus does not take off again are really, really tight. That means we must be very cautious at this stage.

That’s why it’s so important that everyone sticks with the restrictions. In recent weeks people have been absolutely superb at doing that – and I will never be able to tell you how grateful I am to all of you for that. You are the reason that the NHS has not been overwhelmed, as I really feared a few weeks ago that it might be, and by sticking to the guidance,  you have undoubtedly saved lives.

However we are now seeing slight increases in people using our roads. In addition, more people are using concessionary bus travel than a few weeks ago. Both of these trends are from low starting points, but they are still sources of some concern.

For example the number of people who are using concessionary transport increased by almost 1/6 last week.

The car traffic we’ve observed on major roads is less than 1/3 of its pre-lockdown levels, but it has increased this week by about 5% this week, compared to last week. On some town and city roads, traffic has been 10% higher than in the week before.

So what I am asking all of you to do today, and you know the reasons that I am asking you to do this, is think about whether or not it is the case that right now you are a little bit more active than you might have been at the start of the lockdown, and to ask yourself why that is the case.

Was your journey really essential? You might think it’s only you making an extra journey, and that it’s only one trip – and you might well feel you deserve it after weeks of restraint. Believe me, I really understand all of that. But all of it adds up – and the fact remains that if everyone eases off, the virus will quickly take off again and it will have devastating consequences for all of us.

I know this is a long haul – I know that people want to travel a bit more, I know that children want to spend more time outside. I absolutely know that every grandparent is desperate to see and to hug their grandchildren. But as things stand, our progress against the virus, albeit very real progress, is too fragile for us to let up.

But the more we do stick to the lockdown, the more we will reduce the R number below 1, and the lower it goes, the more scope we will have to ease the lockdown measures in future.

So please, I am asking you again, stay at home – except for essential purposes.

If you do leave home, remember to stay more than 2 metres away from other people, and don’t meet up with people from other households.

If you have any symptoms of the virus, you and your household should isolate completely. And everybody should still be washing their hands regularly and thoroughly.

By sticking to all of that, we can keep that R number below 1. We will slow the spread of the virus, protect the NHS, and we will save lives. And – while it might not feel like it right now, and I am pretty sure it doesn’t – we will actually all help each other to come through the other side of this a bit more quickly.

The other thing that I want to update you on, is our support for business.

Today, three new business support funds, which total £100 million, open for applications.

They are part of a wider package of measures to support business, which are worth around £2.3 billion in total.

One of the funds is the Newly Self-Employed Hardship Fund, which is managed by Local Authorities.

It is open to newly self-employed people who are facing hardship but – because they became self-employed in the last year – are ineligible for other support. They will be able to apply for grants of £2,000.

The lack of support for newly self-employed people is something which has been much commented upon – I am glad we can now do something now to give assistance.

The second fund is the Creative, Tourism & Hospitality Enterprises Hardship Fund. This is managed by our Enterprise Agencies with support from Creative Scotland and VisitScotland.

It will provide grants of up to £25,000 for smaller creative, tourism and hospitality companies who do not benefit from business rates relief – for example if they do not have premises which can benefit.

And finally, we have also established the Pivotal Enterprise Resilience Fund, which is again managed by our Enterprise Agencies.

This will provide grants and support to small and medium sized businesses which we think are potentially vital to Scotland’s economic future, or to the economies of certain local areas – but which have been made vulnerable by this crisis.

This is an important way of trying to safeguard our economic future and potential – by ensuring that smaller companies with lots of potential are not driven out of business during this crisis.

Applications for these funds will be open from 2 pm today. We hope that successful applicants will start receiving money in the next couple of weeks.

If you think that you might qualify for one of these grants, you can find more detail at www.FindBusinessSupport.gov.scot

I want to end by re-iterating my earlier message. Please stick to the guidance. I know this is not easy. And when I say that, I am not just saying what I know you want to hear – I really know this is not easy. But it is making the difference: so please, please, stick with it.

MAY DAY: Half of the world’s workers could see their livelihoods destroyed

“For millions of workers, no income means no food, no security and no future. Millions of businesses around the world are barely breathing. They have no savings or access to credit.”

The continued sharp decline in working hours globally due to the COVID-19 outbreak  means that 1.6 billion workers in the informal economy – that is nearly half of the global workforce – stand in immediate danger of having their livelihoods destroyed, warns the International Labour Organization.

According to the ILO Monitor third edition: COVID-19 and the world of work , the drop in working hours in the current (second) quarter of 2020 is expected to be significantly worse than previously estimated.

Compared to pre-crisis levels (Q4 2019), a 10.5 per cent deterioration is now expected, equivalent to 305 million full-time jobs (assuming a 48-hour working week). The previous estimate was for a 6.7 per cent drop, equivalent to 195 million full-time workers. This is due to the prolongation and extension of lockdown measures.

Regionally, the situation has worsened for all major regional groups. Estimates suggest a 12.4 per cent loss of working hours in Q2 for the Americas (compared to pre-crisis levels) and 11.8 per cent for Europe and Central Asia. The estimates for the rest of the regional groups follow closely and are all above 9.5 per cent.

Informal economy impact

As a result of the economic crisis created by the pandemic, almost 1.6 billion informal economy workers (representing the most vulnerable in the labour market), out of a worldwide total of two billion and a global workforce of 3.3 billion, have suffered massive damage to their capacity to earn a living. This is due to lockdown measures and/or because they work in the hardest-hit sectors.

The first month of the crisis is estimated to have resulted in a drop of 60 per cent in the income of informal workers globally. This translates into a drop of 81 per cent in Africa and the Americas, 21.6 per cent in Asia and the Pacific, and 70 per cent in Europe and Central Asia.

Without alternative income sources, these workers and their families will have no means to survive.

Enterprises at risk

The proportion of workers living in countries under recommended or required workplace closures has decreased from 81 to 68 per cent over the last two weeks. The decline from the previous estimate of 81 per cent in the second edition of the monitor  (published April 7) is primarily a result of changes in China; elsewhere workplace closure measures have increased.

Worldwide, more than 436 million enterprises face high risks of serious disruption. These enterprises are operating in the hardest-hit economic sectors, including some 232 million in wholesale and retail, 111 million in manufacturing, 51 million in accommodation and food services, and 42 million in real estate and other business activities.

Urgent policy measures needed

The ILO calls for urgent, targeted and flexible measures to support workers and businesses, particularly smaller enterprises, those in the informal economy and others who are vulnerable.

“For millions of workers, no income means no food, no security and no future. […] As the pandemic and the jobs crisis evolve, the need to protect the most vulnerable becomes even more urgent.”

Guy Ryder, ILO Director-General

Measures for economic reactivation should follow a job-rich approach, backed by stronger employment policies and institutions, better-resourced and comprehensive social protection systems. International co-ordination on stimulus packages and debt relief measures will also be critical to making recovery effective and sustainable. International labour standards, which already enjoy tripartite consensus, can provide a framework.

“As the pandemic and the jobs crisis evolve, the need to protect the most vulnerable becomes even more urgent,” said ILO Director-General Guy Ryder.

“For millions of workers, no income means no food, no security and no future. Millions of businesses around the world are barely breathing. They have no savings or access to credit.

“These are the real faces of the world of work. If we don’t help them now, these enterprises will simply perish.”

Coronavirus could see Scotland’s economy shrink by a third

The economic impact of the efforts to tackle the coronavirus (COVID-19) pandemic could see Gross Domestic Product (GDP) fall by around a third, according to a report by the Chief Economist.

The latest State of the Economy report, published by the Scottish Government’s Chief Economist Gary Gillespie, presents analysis showing that GDP in Scotland could fall by around 33% during the current period of social distancing, similar to estimates from UK and international bodies such as the Office for Budget Responsibility (OBR) and the Organisation for Economic Co-operation and Development (OECD).

Alongside a summary of latest economic developments, the report includes Scottish Government analysis of:

• channels through which COVID-19 is impacting Scotland’s economy;
• short term impact of social distancing on GDP and the labour market;
• exposure of different sectors to COVID-19 risks;
• medium term path of the economic recovery.

Economy Secretary Fiona Hyslop said: “Our response to COVID-19 is saving lives, but I am deeply aware that the pandemic is having an economic effect that is already being felt across Scotland.

“The Scottish Government is doing everything we can to support businesses at this very difficult time.

“We want Scotland to recover as quickly as possible from this outbreak, and that includes rebuilding our economy as quickly as is safely possible.

“None of us should be under any illusions about the scale of economic recovery and, as we have said before, no government will have all of those answers.

“That is why we have set up an independent advisory group to provide expert economic advice and this will be crucial to help us deal with the challenge of rebuilding our economy.”

state-economy

 

Chancellor delivers Tuesday’s UK Government update

Good evening from Downing Street, where I’m joined by Steve Powis, Medical Director of the NHS and Yvonne Doyle, Medical Director at Public Health England.

Earlier today, the government’s independent fiscal watchdog, the Office for Budget Responsibility, the OBR, published a report into the impact of coronavirus on the economy and public finances.

It’s important to be clear that the OBR’s numbers are not a forecast or prediction.

They simply set out what one possible scenario might look like – and it may not even be the most likely scenario.

But it’s important we are honest with people about what might be happening to our economy.

So before I turn to the health figures, I want to spend a few minutes explaining what the OBR have said – and let me thank them for their continued work.

There are three brief points I want to make.

First, the OBR’s figures suggest the scale of what we are facing will have serious implications for our economy here at home, in common with other countries around the world.

These are tough times – and there will be more to come.

As I’ve said before, we can’t protect every business and every household.

But we came into this crisis with a fundamentally sound economy, powered by the hard work and ingenuity of the British people and British business.

So while those economic impacts are significant – the OBR also expect them to be temporary…

…with a bounce back in growth.

The second point I want to make is that we’re not just going to stand by and watch this happen.

Our planned economic response is protecting millions of jobs, businesses, self-employed people, charities and households.

Our response aims to directly support people and businesses while the restrictions are in place…

…and to make sure as restrictions are changed, we can, as quickly as possible, get people back to work; get businesses moving again; and recover our economy.

The OBR today have been clear that the policies we have set out will do that.

The OBR today have been clear that if we had not taken the actions we have, the situation would be much worse.

In other words, our plan is the right plan.

The third point I want to make is this: right now, the single most important thing we can do for the health of our economy is to protect the health of our people.

It’s not a case of choosing between the economy and public health – common sense tells us that doing so would be self-defeating.

At a time when we are seeing hundreds of people dying every day from this terrible disease, the absolute priority must be to focus all of our resources…

…not just of the state, but of businesses, and of all of you at home as well, in a collective national effort to beat this virus.

The government’s approach is to follow scientific and medical advice through our step-by-step action plan, aiming to slow the spread of the virus, so fewer people need hospital treatment at any one time, protecting the NHS’s ability to cope.

I said in my Budget a month ago that whatever the NHS needs, it will get – and we have honoured that promise:

Yesterday we published an update showing that we’ve given our public services an extra £14.5 billion in recent weeks.

We are taking action to increase NHS capacity, with more beds, more key staff and more equipment on the front-line.

And the Secretary of State for Health and Social Care will be updating on our plans for social care tomorrow.

This is why we are instructing people to stay at home, so that we can protect our NHS and save lives.

I can report that through the government’s ongoing monitoring and testing programme, as of today:

  • 302,599 people in the UK have now been tested for coronavirus, with 93,873 people testing positive
  • 19,706 people in the UK have been admitted to hospital with the virus, down from 20,184 people yesterday;
  • Sadly, of those in hospital, 12,107 people have now died – an increase of 778 fatalities since yesterday.

Our thoughts are with the families and friends of all those who have lost their lives.

These figures are a powerful reminder to us all of the importance of following the government’s guidance:

Stay at home. Protect our NHS. And save lives.

Help for the self-employed … but not until June

Chancellor Rishi Sunak made his long-awaited statement on support for the UK’s five million self-employed workers yesterday. That support will not kick in until June at the earliest, however, and does not cover those workers who have been self-employed for less than three years.

This is what he said:

Good afternoon.

Today I can announce the next step in the economic fight against the Coronavirus pandemic, with new support for the self-employed.

Our step-by-step action plan is aiming to slow the spread of Coronavirus so fewer people need hospital treatment at any one time, protecting the NHS’s ability to cope.

At every point, we have followed expert advice to be controlled in our actions – taking the right measures at the right times.

We are taking unprecedented action to increase NHS capacity by increasing the numbers of beds, key staff and life-saving equipment on the front-line to give people the care they need.

That is why it is absolutely critical that people follow our instructions to stay at home, so we can protect our NHS and save lives.

Our action plan to beat the pandemic is the right thing to do – but we know people are worrying about their jobs and their incomes.

Working closely with businesses and trade unions, we have put together a coherent, coordinated and comprehensive economic plan – a plan which is already starting to make a difference:

  • big employers like Brewdog, Timpsons and Pret have already said that our Coronavirus Jobs Retention Scheme means they can furlough thousands of staff, rather than laying them off. And we are publishing this evening detailed guidance on how the scheme will operate so that other businesses can take advantage, too
  • small businesses are already benefiting from Coronavirus Business Interruption Loans of up to £5 million, which are interest free for 12 months – with 30,000 enquiries in just four days
  • local authorities are already informing more than 700,000 retail, hospitality and leisure businesses that they will pay no business rates this year
  • and the new hardship grants scheme, providing cash grants of up to £25,000 for the smallest businesses, is now up and running

So if any business is struggling, and worrying they may need to lose staff, I would urge you to log on to businesssupport.gov.uk, and look very carefully at what support is available before deciding to lay people off.

I’m proud of what we’ve done so far, but I know that many self-employed people are deeply anxious about the support available for them.

Musicians and sound engineers; plumbers and electricians; taxi drivers and driving instructors; hairdressers and childminders and many others, through no fault of their own, risk losing their livelihoods.

To you, I say this: You have not been forgotten. We will not let you behind. We are all in this together.

So, to support those who work for themselves, today I am announcing a new Self-Employed Income Support Scheme.

The government will pay self-employed people, who have been adversely affected by the Coronavirus, a taxable grant worth 80% of their average monthly profits over the last three years, up to £2,500 a month.

This scheme will be open for at least three months – and I will extend it for longer if necessary.

You’ll be able to claim these grants and continue to do business.

And we’re covering the same amount of income for a self-employed person as we are for furloughed employees, who also receive a grant worth 80%.

That’s unlike almost any other country and makes our scheme one of the most generous in the world.

Providing such unprecedented support for self-employed people has been difficult to do in practice.

And the self-employed are a diverse population, with some people earning significant profits.

So I’ve taken steps to make this scheme deliverable, and fair:

  • to make sure that the scheme provides targeted support for those most in need, it will be open to anyone with income up to £50,000.
  • to make sure only the genuinely self-employed benefit, it will be available to people who make the majority of their income from self-employment
  • and to minimise fraud, only those who are already in self-employment, who have a tax return for 2019, will be able to apply

95% of people who are majority self-employed will benefit from this scheme.

HMRC are working on this urgently and expect people to be able to access the scheme no later than the beginning of June.

If you’re eligible, HMRC will contact you directly, ask you to fill out a simple online form, then pay the grant straight into your bank account.

And to make sure no one who needs it misses out on support, we have decided to allow anyone who missed the filing deadline in January, four weeks from today to submit their tax return.

But I know many self-employed people are struggling right now, so we’ve made sure that support is available.

Self-employed people can access the business interruption loans.

Self-assessment income tax payments, that were due in July, can be deferred to the end of January next year.

And we’ve also changed the welfare system so that self-employed people can now access Universal Credit in full.

A self-employed person with a non-working partner and two children, living in the social rented sector, can receive welfare support of up to £1,800 per month.

The scheme I have announced today is fair.

It is targeted at those who need it the most.

Crucially, it is deliverable.

And it provides an unprecedented level of support for self-employed people.

As we’ve developed the scheme, I’m grateful for the conversations I’ve had with the Federation of Small Businesses, the association of Independent Professionals and the Self-Employed, and a range of trade unions, including the Trades Union Congress.

But I must be honest and point out that in devising this scheme – in response to many calls for support – it is now much harder to justify the inconsistent contributions between people of different employment statuses.

If we all want to benefit equally from state support, we must all pay in equally in future.

These last ten days have shaken our country and economy as never before.

In the last two weeks we have put aside ideology and orthodoxy to mobilise the full power and resources of the British state.

We have done so in pursuit of a single goal: to protect people’s health and economic security, by supporting public services like our NHS, backing business, and protecting people’s jobs and incomes.

What we have done will, I believe, stand as one of the most significant economic interventions at any point in the history of the British state, and by any government, anywhere in the world. We have:

  • pledged that whatever resources the NHS needs, it will get
  • promised to pay 80% of the wages of furloughed workers for three months up to £2,500
  • deferred more than £30 billion of tax payments until the end of the year
  • agreed nearly 17,000 Time to Pay arrangements for businesses and individuals
  • made available £330 billion of loans and guarantees
  • introduced cash grants of up to £25,000 for small business properties
  • covered the cost of statutory sick pay for small businesses for up to two weeks
  • lifted the incomes of over four million households with a nearly £7 billion boost to the welfare system
  • agreed three-month mortgage holidays with lenders and nearly £1 billion more support for renters through the Local Housing Allowance
  • and today we’ve announced one of the most generous self-employed support schemes in the world

Despite these extraordinary steps, there will be challenging times ahead. We will not be able to protect every single job or save every single business.

But I am confident that the measures we have put in place will support millions of people, businesses and self-employed people to get through this, get through it together, and emerge on the other side both stronger and more united.

Thank you.

The Federation of Small Businesses (FSB) – who spearheaded calls for additional help for those that work for themselves – warmly welcomed the proposals.

Andrew McRae, FSB’s Scotland policy chair, said: “Thousands of people who work for themselves in Scotland will now breathe a sigh of relief. This scheme will provide lifeline cash to self-employed people, with help targeted at those on low and moderate incomes.

“We need to vanquish the myth that those that work for themselves are universally wealthy. People like the local handyman, cleaner and fitness coach will benefit from this support.

“Like many of these government interventions, it will take a number of weeks for this programme to deliver. Therefore, those who qualify should try their banks for interim finance if required, while doing what they can to manage their outgoings. This will be much easier said than done, but with help on its way many of the self-employed will rest a little easier.”

Official figures show that there are 320,000+ self-employed people in Scotland.

Andrew McRae said: “Throughout this crisis, we’ve found Ministers in Edinburgh and London sympathetic and approachable. These governments deserve credit for delivering support to business who face difficult circumstances that are neither under their control nor their fault.”

TUC General Secretary Frances O’Grady said: “With so many of the self-employed facing a collapse in their earnings the Chancellor is right to act.

“This is a welcome step forward for self-employed and freelance workers across the economy, from construction to the creative industries.

“It’s vital that support reaches workers as soon as possible. Many are already dealing with severe hardship.

“Unions look forward to being consulted on how this scheme is rolled out.”

£1 billion Business Support Fund opens

Grants to help businesses with COVID-19 impact

Businesses can now apply for grants to help them deal with the impact of the coronavirus (COVID-19) outbreak.

The one-off grants are designed to help protect jobs, prevent business closures and promote economic recovery, and more than 90,000 ratepayers across Scotland will be able to benefit.

The grant support is additional to separate tax relief measures and is part of a package of measures worth £2.2 billion.

Small businesses in receipt of the small business bonus scheme or rural relief, as well as hospitality, leisure and retail business can benefit.

Two types of grant are now available to ratepayers:

• a one-off £10,000 grant to ratepayers of small businesses

• a one-off grant of £25,000 available to retail, hospitality and leisure business ratepayers with a rateable value between £18,001 and £50,999

The list is not exhaustive and if businesses think they may be eligible for one of these grants, they should contact their local authority, which are administering the scheme on behalf of the Scottish Government.

Cabinet Secretary for Finance Kate Forbes said: “While our primary concern is for people’s health, it is clear that the Coronavirus (Covid-19) outbreak will have severe economic consequences, and we are treating it as an economic emergency.

“We are determined to help keep companies in business and support them and their staff during this difficult time.

“Local authorities are the most efficient way to deliver this and we have worked closely with them to deliver these measures – and eligible businesses can apply now.

“Local authorities will aim to make payments within 10 working days, and I’d like to thank them for their help in ensuring this support is delivered as quickly as possible.

“The COVID-19 situation, however, is both severe and fast-moving and requires a coordinated UK response: I will continue to work closely with the UK Government and the other devolved administrations.”

More information on how to apply can be found at:
https://www.mygov.scot/non-domestic-rates-coronavirus/

Chancellor announces worker support package

The Chancellor has outlined an unprecedented package of measures to protect millions of people’s jobs and incomes as part of the national effort in response to coronavirus.

The support comes as the UK Government instructs entertainment and hospitality premises, like bars and restaurants, to close to limit spread of coronavirus.

A new Coronavirus Job Retention Scheme will be set up to help pay people’s wages. Employers will be able to contact HMRC for a grant to cover most of the wages of their workforce who remain on payroll but are temporarily not working during the coronavirus outbreak.

Any employer in the country- small or large, charitable or non-profit will be eligible for the scheme.

Universal Credit and tax credits will also be increased as part of an almost £7 billion welfare boost, as he outlined one of the most generous business and welfare packages by any government so far in response to Covid-19.

To ease cash flow pressures for UK VAT registered businesses, VAT bills from now until the end of June, will be deferred until the end of the tax year.

The Chancellor’s workers’ support package means:

  • UK workers of any employer who is placed on the Coronavirus Job Retention Scheme can keep their job, with the government paying up to 80% of a worker’s wages, up to a total of £2,500 per worker each month. These will be backdated to 1st March and will be initially open for 3 months, to be extended if necessary.
  • VAT payments due between now and the end of June will be deferred. No VAT registered business will have to make a VAT payment normally due with their VAT return to HMRC in that period. Income tax payments due in July 2020 under the Self Assessment system will be deferred to January 2021, benefitting up to 5.7m self-employed businesses.
  • Additionally, the Coronavirus Business Interruption Loan Scheme, launched at Budget, will now be interest free for twelve months.
  • The standard rate in Universal credit and Tax Credits will be increased by £20 a week for one year from April 6th, meaning claimants will be up to £1040 better off.
  • Nearly £1bn of additional support for renters, through increases in the generosity of housing benefit and Universal Credit. From April, Local Housing Allowance rates will pay for at least 30% of market rents in each area.

HMRC are working “night and day” to get the unprecedented Coronavirus Job Retention Scheme up and running and we expect the first grants to be paid within weeks.

Chancellor of the Exchequer Rishi Sunak said: “We continue to do everything possible to protect the public from coronavirus. We have been working round the clock so that we can today confirm an unprecedented package of support to protect people’s jobs and wages. And we’re strengthening our safety net at the same time.

“I said we would help individuals, businesses and the most vulnerable through this outbreak and I meant it. We will do whatever it takes in the weeks and months ahead.”

Work and Pensions Secretary Therese Coffey said: “We will do whatever it takes to protect the most vulnerable and get them through these unprecedented times, and the changes we are making to Universal Credit will help millions of people in most need.

“We are standing by those who rely on the welfare safety net as we work towards turning the tide on this disease and moving on together.”

Business Secretary, Alok Sharma, said: “We have committed to doing whatever it takes to support businesses and households through these unprecedented times, and today shows just how far we are willing to go.

“This intervention is unheard of in peacetime, but it is crucial we stand behind our businesses and those that rely on them for work and income.”

All measures announced yesterday across the business and welfare package are UK-wide.

In order to help delay the spread of Coronavirus, the Government instructed entertainment and hospitality businesses including pubs, bars and restaurants to close from last night.

This follows expert advice that more needs to be done in order tackle the spread of infection – following the call to action to isolate or socially distance. The measure, set to be reviewed on a monthly basis, will not affect supermarkets or retailers that supply fuel, medicines and other vital goods, which will continue to be open as normal for the public.

The following businesses have been asked to close:

  • Food and drink venues for consumption on-site, such as restaurants and cafes.
  • Drinking establishments, including pubs, bars, nightclubs.
  • Entertainment venues, including cinemas, theatres, concert halls, and bingo halls.
  • Museums and galleries.
  • Spas, wellness centres and massage parlours.
  • Casinos and betting shops.
  • All indoor leisure and sports facilities, including gyms.

This measure will not impact the relaxation of planning rules announced earlier this week which will allow pubs and restaurants to operate as hot food takeaways during the coronavirus outbreak.

The decision on closures will be reviewed on a monthly basis, and are being implemented across the whole of the UK in agreement with the devolved administrations. If needed, the government will enforce these measures by law.

Communities Secretary Rt Hon Robert Jenrick MP said: ”We will do whatever it takes to protect people across this country as we tackle the coronavirus outbreak. 

“While people have responded well to calls for social distancing and self-isolation, we must go further if we are to be able to stop the spread of the virus and protect the most vulnerable people in our society, and our NHS.

“That is why we are now telling entertainment and hospitality premises to close temporarily, and people to only travel if absolutely essential, to help protect each other from the further spread of the virus.

“We stand behind businesses and their employees and are offering an unprecedented range of support as we tackle this huge challenge together.”

More information about the measures announced for businesses by the Chancellor can be found here.

Responding to the Chancellor’s further economic announcements, John McDonnell MP, Labour’s Shadow Chancellor, said: “The Chancellor has shifted direction but unfortunately not far enough or fast enough.

“The Government must give people the economic security to stay at home by lifting the level of Statutory Sick Pay, but it appears that the Government hasn’t done that today. Sick pay is being left at a level that the Health Secretary said he could not live on, yet this is what the self-employed are being asked to get by on.

“The Chancellor’s wage protection plan sets out no obligation for employers to keep staff on, and no commitment to full wages being paid, with the cap on incomes meaning that many people will take a significant pay cut.

“This will also take some weeks to roll out at a time when wages need to be guaranteed more urgently.

“Other benefits, including for carers, are not being lifted adequately.

“The Chancellor said he would do whatever it takes, but he can and should go further – and we will keep working constructively with Government to ensure the best possible response to the Coronavirus crisis.”

A spokesperson for the Scottish Licensed Trade Association said: “These extra unprecedented measures are very much welcomed and are a life saver for Scotland’s pubs and bars and the hospitality industry in general. 

“Without all the measures introduced to help our industry, many business would have been forced to close and staff would have lost their jobs and for many these actions would have been permanent.

“Considering our industry was on the edge of a precipice only a week or so ago, the future, for both businesses and staff is now more secure than anyone could have ever foreseen.”

The initiative has also been welcomed by the country’s biggest trade union.

Unite general secretary Len McCluskey said: “This is the package of measures that trade unions like Unite have been pressing for as the most effective way to stave off mass hardship and the conditions for a depression.  

“We recognise that these are huge decisions for any government, and especially for a Conservative government, but they have listened to the calls for action and have acted appropriately. Rishi Sunak’s wage support measures are a historic first for this country, but are bold and very much necessary.

“The key to any wage support programme is that it needs to be simple, straightforward and above all fast. This is the only way to put money into the pockets of the millions who see their livelihoods hanging by a thread.

“This will definitely be some relief amid all the fear in households across the UK this evening. Never before has the country faced a crisis of this nature. People who were only days ago in secure work are now worried sick about putting food on the table in light of the coronavirus pandemic.

“The chancellor has done the right thing and we look forward to working further with him in the coming days to get this money into the hands of those most in need.”

 

Chancellor: “Whatever it takes”

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.”

 

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