Chancellor’s Statement July 8th

Shown below is a summary of the measures affecting employment announced by chancellor. The procedural details which will enable you to apply for the various grants and allowances have yet to be published. However, he was firm that the CJRS furlough system will end on October 31st.

Job retention bonus’ to encourage firms to retain furloughed staff

  • A one-off £1000 payment to employers for every furloughed employee retained to the end of January 2021. This means you will have to bring back your previously furloughed employees and pay them their normal salary from November onwards.
  • Applies to workers earning over £520 per month, UK-wide

Six-month VAT cut for restaurants, hotels and attractions

  • Value added tax cut from 20% to 5% from 13 July to 12 January 2021 for selected areas
  • Food and non-alcoholic drinks in restaurants, pubs and cafes, as well as hot takeaway food will be covered
  • Accommodation in hotels and B&Bs and admission to attractions such as theme parks and cinemas also affected

Discount on restaurant meals in August

  • “Eat out to help out” scheme offers 50% discount for every diner, up to £10 a head, from Monday to Wednesday throughout August
  • Covers food and non-alcoholic drinks only
  • Applies at participating restaurants, pubs, cafes etc
  • Restaurant owners can claim the discount in full from the government via an online form

Support for young workers

  • “Kickstart scheme”: £2bn fund to pay for six-month work placements for 16 to 24-year-olds on universal credit
  • Payments cover national minimum wage for 25 hours per week, plus national insurance and pension contributions for Great Britain
  • £1,000 grant per trainee for employers who take on new trainees aged 16-24 in England, aiming to triple trainee numbers
  • £2,000 grant for employers per apprentice under 25 hired, £1,500 for those over 25, for six months starting 1 August (in England)
  • Doubling the number of work coaches at Jobcentre Plus across Great Britain, with extra help for young jobseekers
  • £150m extra for the Flexible Support Fund, which provides help for jobseekers (in Great Britain)
  • £101m to fund studies for 18 to 19-year-olds in England unable to find work
  • £95m to expand the Work and Health Programme to provide additional support for unemployed people on benefits for more than three months
  • A job-finding support service for those out of work for less than three months, costing £40m
  • £32m over two years for a National Careers Service to provide advice on work and training (in England)

The consensus is that while it is a step forward it will not be enough to stem completely the flow of proposed redundancies. Planning and executing a redundancy programme is a procedural process, the rules are complicated and depending on the numbers involved the time to complete the programme can be quite lengthy.