Rishi Sunak: Government has clear goal to "protect, support and create jobs"
8 July 2020
Chancellor of the Excehquer, Rishi Sunak updated the House on the economy and his plans to protect, support and create new jobs. Including a kickstart scheme, a job retention bonus, VAT cuts and more.
Rishi Sunak: clear goal to "protect, support and create jobs"
Chancellor of the Exchequer, Rishi Sunak told the House "we will do all we can to give everyone the opportunity of good and secure work" and that although hardship lies ahead "no one will be left without hope."
He said the Government's plan has a clear goal to "protect, support and create jobs" (detailed below).
The Government's £160 billion plan protects peoples jobs, incomes and businesses, says Rishi Sunak.
He told the House:
"Despite the extraordinary support we've already provided, we face profound economic challenges.
"The world's 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 training and have stopped hiring.
"Taken together in just two months, our economy contracted by 25%. The same amount it grew in the previous 18 years.
"The Independent Office for Budget Responsibility and Bank of England are both projecting significant job losses, the most urgent challenge we currently face."
Government's plan for jobs
Jobs retention bonus
Mr Sunak said that furlough "could not and should not go on forever.
He said the furlough scheme will wind down "flexibly and gradually, supporting businesses and people through to October".
He announced a new policy "to reward and incentivise employers who successfully bring furlough staff back, a new jobs retention bonus."
The Government will pay companies £1,000 bonus per employee they bring back from furlough, and the employer must continually employ those employees through to January.
The employee must be paid at least £520 on average, in each month from November to January.
The Chancellor of the Exchequer announced a "kickstart scheme" designed to give young people "the best possible chance of getting on and getting a job".
The scheme will directly pay employers to create new jobs for any 16-24 year old at risk of long-term unemployment. They will be new, additional jobs and "decent jobs", with a minimum of 25 hours per week and paid at least minimum wage.
The Government will pay these young people's wages for 6 months, plus an amount to pay for overheads.
He went on to say:
"Today I'm making available an additional £2 billion, enough to fund hundreds of thousands of jobs".
Employers will be paid £1,000 to take on new trainees, with triple the number of places.
£100 billion will be provided to create more places on level 2 and 3 courses.
The Government will also fund careers advisers to help support over a quarter of a million new people.
Mr Sunak also plans to triple sector based work academies.
For the next 6 months, the Government will pay employers to create new apprenticeships. They will be paid £2,000 per apprentice.
A brand new bonus will be introduced to employ apprentices 25 years old and over, with a payment of £1,500.
The Government plans to double the amount of work coaches in job centres.
£1 billion is being invested in the Department for Work and Pensions "to support millions of people back to work."
£2 billion green homes grant
Mr Sunak said:
"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"
Sunak will also release £1 billion of funding to improve the energy efficiency of public sector buildings.
To capitalise the housing market, the Chancellor has cut stamp duty.
The threshold has been increased from £125,000 to £500,000.
This will be a temporary cut running until 31 March 2021 and will take effect immediately.
Protecting jobs in the hospitality and tourism sector
The Government plans to restart the hospitality and tourism sector to help protect jobs.
This will include a VAT cut next Wednesday from 20% to 5% on food, accommodation and attractions.
Sunak has announced an "eat out to help out" discount. He said "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."
Anneliese Dodds: "a recognition of the value of the work of those who have been taken for granted" is needed
Shadow Chancellor of the Exchequer, Anneliese Dodds said "today should have been the day when our Government chose to build a bridge between what has been done so far and what needs to be done to get our economy moving again".
She said that Britain "should've had a back to work budget but instead we got the summer statement with many of the big decisions put off till later".
She continued, "the blunt truth is, we have one of the highest death rates in the world and among the deepest economic damage in the industrialised world".
The Shadow Chancellor of the Exchequer called on the Government "to prevent additional economic damage due to the slow public health response of this Government".
She responded to the statement saying that the Government "still haven't got test, track and isolation working properly" and that the Government "still hasn't got a grip on the low value and limited scope of sick pay, risking people's ability to self-isolate".
Dodds welcomed the Government's plans on VAT and the eat out to help out vouchers, "if delivered properly these measures should help."
On the job retention bonus, she asked:
"how can he ensure that that money will not just go to those employers who were already planning to bring people back into work and what will he do for those firms who lack the cash flow to operate, even with that bonus?"
Anneliese scrutinised Rishi's statement by saying "we still haven't heard the Government's plans from other sectors" including SMEs (small and medium-sized enterprises).
She said we need to make sure that "the kickstart scheme provides genuinely additional opportunities for young, unemployed people" and "government must also recognise the specific challenges faced by older job seekers, many of whom are becoming unemployed for the first time".
On the green homes, Anneliese said:
"the Conservatives are still refusing to impose conditions on investments, to ensure that it contributes to the goal of net zero, that it supports local jobs, supports local firms, leads to sustainable skilled employment in local areas and prevents the use of tax havens and other forms of asset stripping."
The Shadow Chancellor of the Exchequer told the House that the statement did not include funding for the NHS and social care services, which was promised by the Government previously. She said "a recognition of the value of the work of those who have been taken for granted" is needed.
Find out more
- Watch Parliament TV: Statement: Economic update
- Transcripts of proceedings in the House of Commons Chamber are available in Hansard online three hours after they happen.