Chancellor Rishi Sunak outlines Winter Economy Plan

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The Chancellor Rishi Sunak has today outlined additional government support to provide certainty to businesses and workers impacted by coronavirus across the UK.

Delivering a speech in Parliament, the Chancellor announced a package of measures that will continue to protect jobs and help businesses through the uncertain months ahead as we continue to tackle the spread of the virus. The package includes a new Jobs Support Scheme to protect millions of returning workers, extending the Self Employment Income Support Scheme and 15% VAT cut for the hospitality and tourism sectors, and help for businesses in repaying government-backed loans.

What did the Chancellor announce? Here is a summary whilst we wait for full details:

  • A new Jobs Support Scheme will be launched for employees working at least a third of their normal hours, who are being paid for that as normal. The government and employers will jointly increase their wages to cover two-thirds of their lost pay and the employee will keep their job
  • All small and medium-sized businesses are eligible, but larger businesses must show their turnover has fallen during the crisis. Employers can use it even if they have not previous used the furlough scheme it replaces
  • It will run for six months from November
  • The existing grant for self-employed people is being extended on similar terms to the Jobs Support Scheme
  • A “pay as you grow” scheme was announced for businesses, allowing them to extend their bounce back loans from six to 10 years, reducing their payments
  • Businesses can also move to interest-only payments or suspend repayments for six months if they are “in real trouble”. Credit ratings will be unaffected
  • The government guarantee on Coronavirus Business Interruption Loans will be extended to 10 years and a new successor loan guarantee programme will be announced in January
  • The temporary reduction of VAT from 20% to 5% for some sectors will remain in place until 31 March 2021

The MIA will of course bring you more details on all of the above as soon as its available. 

Here is the full announcement on the Governments website: www.gov.uk/government/news/chancellor-outlines-winter-economy-plan