Yesterday Rishi Sunak announced his summer statement and outlined how he is going to help small and medium business owners as the country continues to struggle in the wake of the COVID-19 lockdown.
So what do all of his new package of measures really mean and how is it going to benefit business owners across the UK.
Mr Sunak unveiled a number of new measures and announced “It will give businesses the confidence to retrain and hire this autumn.” Is this true and will it actually help the majority of small businesses as they fit to survive
Job Retention Scheme
The chancellor announced a £9bn initiative to reward small and medium businesses in the UK that take furloughed employees off furlough and bring them back into work.
Any SME in the UK that is able to take back a furloughed employee into their business as the reopen will be given a £1,000 grant for each worker. The caveat on this is that this employee providing must still be employed by the end of January and they must have been continuously employed earning a minimum of £520 per month from November to January.
Mr Sunak added: “If you stand by your workers, then we will stand by you.”
Kickstart jobs scheme
Along with the job retention scheme chancellor Rishi Sunak also announced a £2bn scheme to incentivise small business owners in the UK to hire young people.
The new Kickstart scheme has been launched to try and support and help 500,000 that 16-to-24-year-olds currently claiming Universal Credit to find work, as the UK government has agreed to pay the National Minimum Wage for 25 hours a week for six months along with giving small business owners a £1,000 grant to cover admin costs for employing these young people.
Along with this each young Kickstart worker in this scheme will receive £5,000 from the government over half a year, with small business owners able to top up minimum-wage pay packets.
The first jobs can be offered in the autumn and the scheme will run until December 2021, though it is likely to be extended if it proves successful.
Rishi Sunak also confirmed that the government will pay small business owners in the UK £2,000 to take on other 16-to-24-year olds as unpaid trainees.
Small businesses owners that offer training for young people aged between 16 and 24 will be given cash “bonuses” of grants worth £2,000 per young person they take on through this scheme with a maximum of £10,000 per firm.
The UK government will also pay £1,500 for every new apprentice above 25 hired. Mr Sunak said that 91 per cent of traineeships turn into full-time jobs when he was discussing the benefits of this scheme
5% VAT cut for hospitality and leisure
Sunak also announced he was cutting VAT cut from 20% to 5% for over 150,000 businesses in the hospitality and attractions sectors. The VAT cut will come into effect next Wednesday, July 15. Bars, pubs, hotels, restaurants, accommodation and attractions such as cinemas and theme parks will all qualify for the new 5% VAT rate.
Eating out subsidy
Pubs and restaurants will be able to claim back up to £10 per person from customers eating out during the week from Monday to Wednesday, with the government announcing it would subsidise meals out by 50 per cent throughout August.