Further news from the Treasury today highlighted that the government is trying to paint a picture of hope in the coming months despite the potential fear of job losses. In such a difficult economic environment, sadly there will be many that won’t be helped.
However, the key announcements include:
- A new job retention bonus for employers who bring back furloughed staff. The offer includes a £1000 bonus for every furloughed employee they keep on until the end of January, and pay at least £520 per month. The idea of any extended furlough scheme appear to be clearly dead and buried for now.
- A £2 billion scheme to create thousands of job placements for young people all via apprenticeships. The government will fund 6-month job placements for 18-24 year olds, who are viewed at risk as being at most risk of suffering the long term consequences of unemployment during the crisis. The government will cover 100% of the national minimum wage for each young employee, for 25 hours a week.
- Stamp duty reduction for houses up to £500,000 until 31 March 2021. The aim is to revive the flagging housing market and applies also the anyone seeking to purchase an investment property but they will still will need to pay the surcharge of 3% on the entire price.
- A 50% discount on restaurant/pub meals on Monday to Wednesday during August, at a maximum of £10 per head. Sadly this does not cover beer. So many pubs who don’t really serve food will not be able to benefit from this announcement.
- A temporary cut to VAT on food, accommodation and attractions. Down from 20% to 5%.
- A £2 billion green homes grant to help homes become more energy efficient whilst creating further jobs.
Of course, there is more that can be done, but this level of government spending is totally off the scale, so holding some back for when we may need more in the future is probably a prudent approach to take.
Difficult economic times ahead, but a drive to helping the young and some of those businesses most heavily effected by COVID 19 is in my opinion not a bad result.
But the question has to be asked how will all of this be paid for? Tax rises may be on the horizon sooner than we think!