Yesterday, the Chancellor, Rishi Sunak, announced the Covid-19 summer budget which saw him introduce several initiatives in order to help businesses recover and kickstart the economy. These include the following:
Job Retention Bonus
Firstly, Employers will receive a £1000 bonus (per employee), for each furloughed employee who remains in continuous employment until 31st January 2021.
In order to qualify to receive this bonus, the employee must earn an average of £520 per month between November and January and have been legitimately furloughed under the CRJS. The government intend to make these payments from February 2021 and further details surrounding this scheme will be announced at the end of July.
The government have also announced a number of new schemes, to encourage employers to take on apprentices and to get younger people in work. These include:
- The launch of a Kickstart scheme to create high quality 6-month work placements for those aged between 16-24 who are currently on Universal credit and are considered to be at risk of long-term unemployment. The funding of this scheme will be available for each job and will cover 100% of the NMW, employers NIC and automatic employer enrolment contributions.
- The government will fund employers who provide trainees with work experience at a rate of £1000 per trainee.
- The government will pay employers £2000 for each new apprentice they hire who is under the age of 25 and £1500 for each new apprentice who is aged 25 and above.
The Chancellor also announced a VAT reduction – from 15 July until 12 January 2021, the UK government will cut VAT from 20% to 5% on any eat-in or hot takeaway food and drinks from restaurants, cafes and pubs, excluding alcohol. This VAT reduction also applies to all holiday accommodation in hotels, B&Bs, campsites and caravan sites, as well as attractions like cinemas, theme parks and zoos.
He has also announced a “Eat out to Help out” scheme, which will mean that participating businesses, including restaurants, will be able to offer 50% off the final bill in August up to a maximum of £10 per head for everyone, including children. This will apply Monday to Wednesday.
