Chancellor Rishi Sunak has announced a new economic recovery plan in his summer economic statement. The recovery plan sets out measures to stimulate economic recovery in the UK.
Introduction of the Job Retention Bonus
The Job Retention Bonus is announced as a follow up from the Coronavirus Job Retention Scheme. The original scheme saw the government provide grants to employers who furloughed staff. It aimed to minimise redundancies following the production downturn caused by COVID-19.
Sunak’s Job Retention Bonus encourages employers to bring back furloughed employees as the scheme winds down. Employers will receive a one-off payment of £1,000 per employee who returns to work until the end of January 2021 .
Temporary VAT rate cut confirmed for hospitality and tourism sector
For businesses operating in the hospitality and tourism industries the existing 20% VAT rate will temporarily reduce to 5%
Hospitality sector stimulus plan “Eat Out to Help Out” announced
Further support for hospitality sector businesses arrives in the form of Sunak’s ‘Eat Out to Help Out’ scheme. It means the government will fund 50% off meals when dining out in participating restaurants.
The scheme allows a discount of up to £10 per person for children and adults, and will be available on Mondays, Tuesdays, and Wednesdays.
Young people’s kickstart jobs scheme set in motion
The Kickstart Jobs Scheme is part of the government’s focus on a #PlanForJobs. This is in response to concerns about the effects of COVID-19 on employment opportunities for young people.
The subsidy is for employers taking on staff who are on Universal Credit and aged between 16 and 24. In return the government will cover the cost of up-to 25 hours a week per eligible employee. The scheme will cover costs based on the National Minimum Wage.
For employees aged 16 to 18 the National Minimum Wage is £4.55 per hour.
Employees aged 18 to 20 the National Minimum Wage is £6.45 per hour.
For employees aged 21 to 24 the National Minimum Wage is £8.20 per hour.
Apprenticeship and trainee grants for employers as part of the coronavirus recovery plan
Following the impact of coronavirus on young workers, businesses are encouraged to take on apprentices and trainees. Chancellor Sunak announced that employers hiring apprentices and trainees will receive government funding to do so:
Employers will receive £2,000 for hiring apprentices, (or £1,500 for taking on apprentices over the age of 25)
Employers will also receive £1,000 for trainees that they take on
Green homes grant plan unveiled
As part of his ‘mini budget’ the Chancellor additionally revealed a new green homes grant. The scheme encourages homeowners in England to make environmentally-friendly upgrades to properties. They will receive a contribution of up to two thirds of the cost, up to a maximum of £5,000.