Yesterday, the Chancellor announced our Winter Economy Plan to support businesses, jobs and people’s livelihoods through coronavirus.
Thanks to our comprehensive economic support package in March there are reasons to be cautiously optimistic – with three consecutive months of growth and millions of people moving off furlough back into work. But the resurgence of the virus means that we now have to take more measures to support our economy. These include:
A Jobs Support Scheme – Which will directly support the wages of people in work, giving businesses who face depressed winter demand the option of keeping employees in a job on shorter hours rather than making them redundant. The scheme will support viable jobs so employees must be working at least a third of their normal hours and be paid for that work, as normal, by their employer. The government, together with employers, will then increase those people’s wages covering two-thirds of the pay they would have lost by reduced working hours.
Self Employed Support - To ensure parity between employees and self-employed, we will also provide a grant extension for self-employed small businesses who used the existing SEISS scheme.
VAT Cut Extended - To support more than 150,000 businesses and protect 2.4 million jobs through the winter we are cancelling the planned increase in VAT for hospitality and tourism. We will keep the lower 5% VAT rate until March 31st next year.
Pay As You Grow - Bounce Back Loans have given over a million small businesses the boost they needed to survive this pandemic, with combined lending now worth £38 billion. To give those businesses more time and greater flexibility to repay their loans, we’re introducing Pay As You Grow. This means: Loans can be extended from six to ten years – nearly halving the average monthly repayment; businesses who are struggling can now choose to make interest-only payments and anyone in trouble can apply to suspend repayments altogether for up to six months.