Chancellor Rishi Sunak MP has delivered a statement in the House of Commons on the next stage of the Government’s economic response to COVID-19.
The Chancellor stated that the task is now to "nurture" the economy by protecting “viable” jobs through the "difficult winter months", and that is why the response "must be different to what came before". Confirming his decision to end the Coronavirus Job Retention Scheme in October, he announced a package of measures including a successor to the furlough scheme which saw Government pay up to 80% of employees wages. He explained that as the Prime Minister and the Government’s scientific advisers have said that COVID-19 will be here “for at least the next six months”, and therefore the economy will need “a more permanent” adjustment.
As a result, the Autumn budget has been cancelled to allow for the government to focus on its COVID-19 response.
The measures announced by the Chancellor include:
• Introduction of the Job Support Scheme to directly support the wages of people in work, allowing businesses to keep employees in a job shorter hours, with taxpayer paying a third of wages for unworked hours.
• More than one million businesses which have borrowed under the Bounce Back Loan Scheme will be offered the choice of more time and greater flexibility for their repayments, under a plan labelled “Pay As You Grow”
• Businesses who deferred tax payments earlier in the year will be given more time and flexibility to pay, HMRC will allow bills to be spread over 11 smaller monthly repayments.
"We welcome measures to support hard pressed businesses, including publishers, who have seen revenues decline with newsstand, advertising and events revenues all been hit hard by the pandemic. While today’s announcements will help the economy through the tough months ahead, more targeted support is needed to support viable businesses," PPA commented. "We continue to call on Government to provide support to this vital sector with extension of Business Rates Relief, event-cancellation insurance and other targeted measures.”
Full details of the packages announced can be found in the Treasury Policy Paper.