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 the three-point plan, the Chancellor announced that the government will:
• Support jobs with a £1,000 Job Retention Bonus, investment in Jobcentre Plus support, support for apprenticeships, tripling the number of traineeships and sector-based work academies placements to build the skills people need to get back to work, and a £2 billion Kickstart scheme to subsidise jobs for young people;
• Create jobs through a ‘Green Homes Grant’ and a new Public Sector Decarbonisation Scheme, and also by investing over £1.5 billion in key health infrastructure, over £1 billion for a new ten-year school rebuilding programme, and £1 billion for local projects to boost local economic recovery in the places that need it most;
• Protect jobs with VAT cuts for the hospitality sector and tourist attractions, as well as a Eat Out to Help Out discount scheme.
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 £160bn package of support – one of the largest and most comprehensive economic responses in the world.
In the East Midlands this package has so far protected around 559,000 jobs, paid £875 million in grants to more than 74,000 businesses and paid £44 million to 153,000 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 the East Midlands, Chancellor Rishi Sunak said: “We have set out our plan to protect, create and support jobs across the East Midlands – to level up opportunity as we safely reopen our economy.
“With money for skills, traineeships and apprenticeships and our new £2 billion Kick Start scheme for young jobseekers, we’re supporting people into jobs.
“We’re creating thousands of new green jobs with more than £95m in shovel-ready projects for the region, £8m for roads, footways and cycleways, and a boost to local builders with £15m through the Short Term Home Building Fund.
“And with VAT cuts for the hospitality and tourism sector and our Eat Out to Help Out scheme, we’re helping to protect 143,000 existing hospitality jobs in the region.”
As part of the plan to support jobs, a Job Retention Bonus will be introduced to help firms 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.
A new £2 billion Kickstart Scheme will also be launched to create hundreds of thousands of new, fully subsidised jobs for young people across the country.
Those aged 16-24, claiming Universal Credit and at risk of long-term unemployment, will be eligible.
Funding available for each six-month job placement will cover 100% of the National Minimum Wage for 25 hours a week – and employers will be able to top this wage up.
A total of £1.6 billion will be invested in scaling up employment support schemes, training and apprenticeships to help people looking for a job.
Young people, who are amongst the worst hit by the crisis, will benefit from this. This includes:
• Businesses will be given £2,000 for each new apprentice they hire under the age of 25. This is in addition to the existing £1,000 payment the Government already provides for new 16-18-year-old apprentices and those aged under 25 with an Education, Health and Care Plan.
• A £111 million investment to triple the scale of traineeships in 20-21 ensuring more young people have access to high quality training.
• £17 million of funding to triple the number of sector-based work academy placements
• £900 million to double the number of work coaches to 27,000;
• A quarter of a million more young people to benefit from an extra £32 million investment in the National Careers Service.
The plan will also create tens of thousands of jobs through bringing forward work on £8.8 billion of new infrastructure, decarbonisation and maintenance projects.
This includes a £3 billion green investment package that could help support over 100,000 green jobs and upgrade buildings and reduce emissions.
As part of this package homeowners and landlords in England will be able to apply for vouchers from a £2 billion Green Homes Grant scheme this year to pay for green improvements such as loft, wall and floor insulation that could save some households hundreds of pounds a year on their energy bills while creating thousands of jobs for tradespeople.
And a £1 billion programme will make public buildings, including schools and hospitals, greener, helping the country meet its ambitions of achieving Net Zero by 2050, whilst investing in our future prosperity.
In addition, £5.8 billion will be spent on shovel-ready construction projects to get Britain building. This includes:
• £1.5 billion for hospital maintenance and upgrades
• £100 million for our local roads network
• Over £1 billion to start to rebuild schools in the worst condition in England, plus £760 million this year for key maintenance work on schools and FE colleges,
• £1 billion for local projects to boost local economic recovery in the places that need it most and £142 million for court maintenance to repair around 100 courts across England.
The Plan for Jobs confirms that the East Midlands will benefit from:
• People and businesses in the East Midlands will benefit from the Government’s dining out reduction to support the hospitality sector, which employs around 143,000 people in the region.
• Up to £95 million to fund shovel-ready projects across the East Midlands to help provide a boost to the local economy and create jobs. This investment is being targeted on areas that are facing the biggest economic challenges as a result of the pandemic.
This could include schemes such as the Manufacturing Research Centre @ Infinity Park, supporting businesses in the area to grow and delivering 70 new jobs, and the Centre for Innovation in Rural Health in Lincoln, which would create high skilled jobs and provide a focal point for research linked to industrial partners.
• £10.25 million accelerated funding from the Towns Fund to kick-start activity in towns and high streets in 14 towns across the East Midlands, helping them to meet immediate challenges from the pandemic.
• An additional £8 million of transport funding will be invested this year in order to support two new local roads projects in the region, including new footways and cycleways for major roads in South Leicestershire.
• £15 million through the Short Term Home Building Fundto help smaller developers access finance for new housing developments.
• A share of £250 million investment to make progress on replacing out-dated mental health dormitories with single-bed accommodation, allowing Leicestershire, Derbyshire, Nottinghamshire, and Lincolnshire NHS Trusts to improve their mental health inpatient wards.
The plan will also protect jobs. The tourism and hospitality sectors are massive employers in the UK and have been severely impacted by the pandemic due to necessary closures to protect public health. 80% of hospitality firms stopped trading in April and 1.4 million hospitality workers have been furloughed – the highest proportions of any sector.
Ensuring there is enough demand as businesses reopen is key to helping these businesses recover and have the confidence to protect jobs and rehire.
Therefore, to encourage people to safely return to eating out at restaurants the Government’s new Eat Out to Help Out discount scheme will provide a 50% reduction for sit-down meals in cafes, restaurants and pubs across the UK from Monday to Wednesday every week throughout August 2020.
The rate of VAT applied on most tourism and hospitality-related activities will also be cut from 20% to 5%.
This will save households around £160 per year on average and, together with the Eat Out to Help Out Scheme, will support over 2.4m staff at over 150,000 businesses, helping them recover and reopen after the Covid-19 lockdown.
This will give these businesses the confidence to maintain their staff, as more people get through the door and business activity kick-starts again.
We want people to feel confident to move, to buy, to sell, to renovate, and to improve their homes.
So we’re introducing a temporary increase to the Nil Rate Band of Residential SDLT (Stamp Duty) from £125k to £500k until 31 March 2021.
In England and Northern Ireland nearly 9 out of 10 people getting on or moving up the property ladder will pay no Stamp Duty at all.
This will drive growth and support jobs across the housebuilding and property sectors.