Tag: Plan for Jobs

Chancellor: ‘Inspiring’ Scots get back to work after furlough

Chancellor of the Exchequer Rishi Sunak yesterday praised the “inspiring” people and businesses of Scotland during a visit to meet those supported by the UK Government’s £352 billion Plan for Jobs.

Rishi Sunak travelled to Fife, Edinburgh and Glasgow where he visited several businesses that have returned workers from furlough, held a roundtable of Scottish business leaders and saw how Scotland is creating jobs and leading our green recovery.

Around one in three jobs in Scotland have been supported by the UK Government’s support package and more than 90,000 Scottish businesses received more than £4.1 billion in loans since the start of the pandemic.

The Chancellor’s visit came as new figures released yesterday show that the number of people in Scotland on furlough has halved in the last three months, with just 141,500 jobs still furloughed.

 

Chancellor of the Exchequer Rishi Sunak said: “It’s been inspiring to hear stories of people and businesses in Scotland that are now starting to feel the weight of the pandemic lifting off them as they get back to work – our Plan for Jobs is working and it’s great to see people succeeding after a year of uncertainty.

“It’s been a challenging time but the UK Government has delivered one of the most generous packages of support in the world, protecting one in three Scottish jobs.  

“Scotland will be key in ensuring the UK’s economic success – creating jobs, powering our growth and driving a green recovery by hosting COP26 later this year.”

During the visit, the Chancellor toured the Offshore Renewable Energy Catapult Turbine in Leven, Fife. The turbine is the leading technology innovation and research centre for offshore renewable energy.

He met SMEs who have used the turbine for development and have benefitted from UK Government funding for green ventures.

The Chancellor highlighted the important contributions Scotland makes to the UK, including towards the UK’s Net Zero transition and climate change leadership on the world stage, ahead of the COP26 Glasgow conference in November.

He also conducted a roundtable with Scottish businesses in the retail banking sector at the new Queen Elizabeth hub in Edinburgh, where he thanked them for their role in responding to the pandemic, keeping call centres and banks open for vulnerable customers, and distributing many of the UK Government business support schemes.

The Chancellor went on to see preparations for the International Festival and the Fringe. The UK Government gave £1m of funding to Edinburgh Festivals this year, to help the festival promote itself digitally to a bigger audience.

He visited a number of small businesses including Liggy’s Cake Company, which was supported through the furlough scheme and is now hiring new staff.

He also visited Dynamic Earth, an award-winning visitor centre in Edinburgh dedicated to educating people about the earth and environmental issues, and met with several staff who have returned from furlough and met a group of children taking part in the centre’s outdoor activities.

NUMBERS ON FURLOUGH FALL TO LOWEST LEVEL SINCE START OF PANDEMIC

  • Almost three million people have moved off furlough since March, according to latest data
  • More than half a million people left the scheme in the month of June alone, with fewer than two million people now remaining on furlough
  • Chancellor welcomes new data while meeting furloughed employees on a visit to Scotland

ALMOST three million people have moved off the furlough scheme since March as the economy began to bounce back and businesses reopened, according to new statistics.

Figures published yesterday which cover up until the end of June, show the fewest number of people on furlough since the scheme launched in March 2020, down from a peak of nearly nine million at the height of the pandemic in May last year.

1.9 million people remained on the scheme by the end of June, more than half a million fewer than the 2.4 million at the end of May.

The Business Insights and Conditions survey (BICS) shows numbers may have fallen even further – with estimates that between 1.1 and 1.6 million people are still on furlough.

It comes as the Chancellor visited Scotland where he has hailed the economic strength of the union and where the Government’s Plan for Jobs has supported businesses and families during the pandemic.

Ahead of meeting Scottish businesses and individuals in Edinburgh, Glasgow and Fife, where he talked to employees who have returned from furlough, Rishi Sunak welcomed the statistics.

Chancellor of the Exchequer Rishi Sunak said: “It’s fantastic to see businesses across the UK open, employees returning to work and the numbers of furloughed jobs falling to their lowest levels since the scheme began.

“I’m proud our Plan for Jobs is working and our support will continue in the months ahead.”

The figures also show a striking fall in the number of young people on furlough, who for the first time ever, no longer have the highest take-up of the scheme.

In the last three months, younger people have moved off the scheme twice as fast as all other age brackets, with almost 600,000 under 25s moving off the scheme.

Jobs in sectors including hospitality and retail are now also moving off the scheme the fastest, – with more than a million coming off the scheme in the last three months.

This decline means those in hospitality and retail no longer make up the majority of all those on furlough.

Furlough was extended until the end of September to allow for businesses to adjust beyond the end of the roadmap and to bring people back to work.

Starting on 1st August, the employer contribution to furlough costs will increase to 20% and that contribution level will continue until the scheme ends at the end of September.

The Government’s Plan for Jobs continues and is still in place to provide support, including Kickstart, traineeships and more work coaches to help people find jobs.

The government says this ‘is is the right thing to do’ to reduce long term economic scarring in the labour market and our ongoing Plan for Jobs means that we will continue to support people as the economy recovers.

Chancellor outlines latest Plan for Jobs

‘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.

Summer Statement ‘delivers plan for jobs in Scotland’

Chancellor’s statement welcomed by Scottish Secretary but Scottish Government says the package is a huge opportunity missed.

The Chancellor yesterday set out the next steps in the UK Government’s strategy to secure Scotland’s economic recovery from coronavirus – announcing a “Plan for Jobs” to level up, spread opportunity and unite the UK.

Rishi Sunak outlined how he would focus on protecting, supporting and creating jobs as the UK enters the next phase in its recovery following the outbreak.

Delivering his Summer Economic Update, he said: “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.”

As part of a series of landmark measures the Chancellor announced that the government will:

  • support jobs with the Job Retention Bonus to help businesses keep furloughed workers. UK Employers will receive a one-off bonus of £1,000 for each furloughed employee who is still employed as of 31 January 2021.
  • expand Worksearch Support including a Flexible Support Fund and a £2 billion Kickstart scheme to subsidise jobs for young people
  • create jobs in the construction and housing sectors through funding to decarbonise public sector buildings, a demonstrator project to decarbonise social housing and funding to support research and development for Direct Air Capture (as announced by the PM on 30 June)
  • protect jobs with VAT cuts for hospitality and tourism, as well as a Eat Out to Help Out discount scheme.

The Summer Economic Update confirms an additional £800 million of Covid-19 funding for the Scottish Government through the Barnett formula.

The UK Government is now providing £4.6 billion through the Barnett formula to help the Scottish Government support individuals, businesses and public services through Covid-19.

Rishi Sunak said the plan for jobs was the second phase of a three-phase plan to secure the UK’s economic recovery from coronavirus.

The first phase, beginning in March, focused on protection with a £160 billion package of support – one of the largest and most comprehensive economic responses in the world. In Scotland this package has so far protected more than 620,000 jobs, helped thousands of businesses and paid £425 million to 146,000 self-employed people.

The Chancellor outlined that following the second phase focusing on jobs, there would come a third phase focusing on rebuilding, with a Budget and Spending Review in the autumn.

Speaking about the impact for Scotland, Chancellor Rishi Sunak said: “Since this crisis started, our wide-ranging package of support for Scotland has protected more than 620,000 jobs, thousands of businesses and paid £425 million to self-employed people.

“Today I’ve set out our plan to protect, create and support jobs across Scotland – to level up opportunity, safely reopen our economy and strengthen the Union.

“With a massive funding boost for Jobcentre Plus, doubling the number of work coaches, more people will now benefit from personalised and tailored job support. We’re investing £800m through the Barnett formula, giving Scotland the funds to create green news jobs. And we’re protecting the thousands of existing jobs in the hospitality sector with a cut to VAT and the Eat Out to Help Out scheme.”

Scottish Secretary Alister Jack said: “The measures announced by the Chancellor to support the country’s post-coronavirus economic recovery delivers for all parts of the UK.

“The UK Government’s ambitious plan for jobs, with its strong emphasis on our young people, is great news for young Scots.

“The VAT cut for tourism and hospitality will be a huge boost for Scotland. It is now absolutely essential that Scotland’s world-class tourism and hospitality industry can properly open for business.

“The stamp duty cut gives a helping hand to the housing market and building trades in England. I urge the devolved administration to use their powers to do the same in Scotland.

“And, thanks to UK Government spending decisions in the rest of the UK, Holyrood will get a £800 million cash boost, bringing their total additional coronavirus support funding to £4.6 billion.”

“The Chancellor has set out a fantastic package of support. The devolved administration now need to play its part and show they are serious about Scotland’s economic recovery.”

Responding the UK Chancellor’s Summer Statement, Scottish 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

“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.”

Andrew McRae, Federation of Small Business’s (FSBx) Scotland policy chair said: “Good news has been in short supply for nearly four months. We needed action to help protect jobs and stimulate local economies across Scotland and that is exactly what the Chancellor has set out to do.

“However, it should be noted that there are many small businesses that were not supported by the Chancellor’s package – with company directors once again overlooked. Given these businesses have had little to no support in over 100 days, FSB is hoping that support can be provided in the near future.”

On the “kickstart” jobs scheme, Andrew said: “The jobs scheme will hopefully prevent a lost generation of young people, but for it to work in local economies, it must focus on the small employers who employ around one million people in Scotland. We can’t have a situation where local businesses are behind a queue of big corporates because of a target-driven approach.”

On the temporary VAT cut for hospitality and tourism sectors, he added: “Reducing VAT in sectors hit especially hard by the pandemic is an astute move. It will make everyday activities like grabbing a coffee and cake more affordable for budget conscious consumers – while making the country a more attractive destination for tourists home and abroad.”

On the discount to encourage people to eat out, Andrew said: “Scotland is fortunate to have an array of fantastic food offerings in restaurants, cafes and pubs across the country. We need to encourage more people to get back out into the community and spending money, so any moves to do this are welcome.”

The Poverty Alliance has also responded to the Chancellor’s Summer Statement. Peter Kelly, Director of the Poverty Alliance, said:“Young workers have been hard hit by Covid-19 job disruption, so the Chancellor’s announcement of a kickstart jobs scheme is welcome.

“But as the pandemic has highlighted, for too long people have been locked into poverty by low pay and insecure work. So these jobs should pay at least the real Living Wage and should have been accompanied by measures to tackle the precarious work that too many young people have to rely on.

“Part-time jobs that pay only the minimum wage cannot be a long-term solution to the problems in our labour market.

“Our recovery should be based on principles of fair work; that means redesigning jobs not reinforcing current problems.

“With the confirmation that the Job Retention Scheme is to end in October, the statement was an opportunity to fix our social security system before an expected surge in applications in autumn.

“Increasing the numbers of Work Coaches is welcome, but if we want our economic recovery to be a recovery for all, we need a social security system that loosens – not tightens – the grip of poverty on people’s lives. That means ending the benefit cap, making advance Universal Credit payments non-repayable, and ensuring that benefits actually meet people’s needs. “There is still time to make these changes before October and we urge the government to make them.

“The announcement of vouchers to support the hospitality sector falls short of expectations. At a time when more people than ever before are relying on emergency help from food banks, it is action to put cash in people’s pockets that is required, not the offer of a £10 discount on eating out.“