Covid-19: Summer Economic Update

The Chancellor Rishi Sunak set out a ‘Plan for Jobs’ that will spur the UK’s recovery from the Coronavirus outbreak.

Delivering his Summer Economic Update in Parliament, the Chancellor announced a package of measures to support jobs in every part of the country, give businesses the confidence to retain and hire, and provide people with the tools they need to get better jobs.

Below is information about some of the schemes and initiatives launched, the full Plan For Jobs can be found here

Eat Out to Help Out Scheme

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.

Who can register

You can register if your establishment:

  • sells food for immediate consumption on the premises
  • provides its own dining area or shares a dining area with another establishment for eat-in meals
  • was registered as a food business with the relevant local authority on or before 7 July

Job Retention Bonus

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.

The Job Retention Bonus is a one-off payment to employers of £1,000 for every employee who they previously claimed for under the scheme, and who remains continuously employed through to 31 January 2021. Eligible employees must earn at least £520 a month on average between the 1 November 2020 and 31 January 2021. Employers will be able to claim the Job Retention Bonus after they have filed PAYE for January and payments will be made to employers from February 2021.

To be eligible, the employee must have received earnings in November, December and January, and must have been paid an average of at least £520 per month, and a total of at least £1,560 across the three months.
As the employer, you will be able to claim the bonus after you have filed PAYE information for January 2021, and the bonus will be paid from February 2021. More detailed guidance, including how you can claim the bonus online, will be available by the end of September.

Find out more here

Kickstart Scheme

A Kickstart Scheme will 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.

We will publish more details when available.

Construction Talent Retention Scheme

The Talent Retention Scheme is designed to retain and secure essential talent in the sector, this new online portal will support the redeployment of staff at risk of redundancy, allowing them to be temporarily loaned between businesses. Over 500,000 left the industry during the last recession, creating a mass skills shortage, which will only become more acute due to EU Exit and post Covid19 effects. The Talent Retention Scheme will help to stop that.

The scheme has two aims:

1. Facilitate talent matching and employee loans on a temporary basis between business
2. Supply re-deployment of staff at risk of redundancy from other sectors, given the overlapping competencies.

The system is free to use, with funding secured until April 2021, and is based on a proven model in the aerospace and automotive sectors which balances redundancies in companies with recruitment needs in others. It is open to apprentices, self-employed workers, and direct employees, as well as giving displaced workers from other sectors a route to new employment within construction.

Access the system here

More information can be found here 

Other support for young people

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 2020-21 ensuring more young people have access to high quality training.
  • £17 million of funding to triple the number of sector-based work academy placements in 2020-21
  • Nearly £900 million to double the number of work coaches to 27,000;
  • Over a quarter of a million more young people to benefit from an extra £32 million investment in the National Careers Service.

We will publish more details when available.

VAT changes in tourism and hospitality

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 2.4 million 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.

VAT registered businesses can apply a temporary 5% reduced rate of VAT to certain supplies relating to:

  • hospitality
  • hotel and holiday accommodation
  • admissions to certain attractions

The temporary reduced rate will apply to supplies that are made between 15 July 2020 and 12 January 2021. Find out more here

We will publish more details when available.