The Chancellor Rishi Sunak has just announced the UK Government’s Plan for Jobs – supporting Scotland’s young people as the economy recovers from coronavirus. 

  • Young people bear the brunt of most economic crises, and they are at particular risk this time because they work in the sectors disproportionately hit by the pandemic. 

 

  • That is why the Chancellor has today set out a bold plan to protect, support and create jobs, the biggest package of support for youth unemployment ever. The landmark £2 billion Kickstart Scheme will create hundreds of thousands of new, high-quality jobs for young people at risk of long-term unemployment.  

 

  • This Plan for Jobs will help Scotland bounce back from coronavirus and secure the UK’s economic recovery. It’s now time for the SNP to match the Chancellor’s ambition and take concrete action to get Scotland’s economy moving. 

 

Supporting Jobs 

£1000 for every member of staff brought back from furlough

(HM Treasury, Plan for Jobs, 8 July 2020, link). 

 

  • A Job Retention Bonus worth £1,000 for every furloughed employee who is kept on. The UK Government will introduce a one-off payment of £1,000 to UK employers for every furloughed employee who remains continuously employed through to the end of January 2021. Payments will be made from February 2021. Further detail about the scheme will be announced by the end of July. 

 

  • A £2 billion Kickstart Scheme to create hundreds of thousands of high-quality work placements. The UK Government will introduce a £2 billion fund to create hundreds of thousands of high quality 6-month work placements aimed at those aged 16-24 who are on Universal Credit and are deemed to be at risk of long-term unemployment. Funding available for each job will cover 100 per cent of the relevant National Minimum Wage for 25 hours a week, plus the associated employer National Insurance contributions and employer minimum automatic enrolment contributions. 

 

  • Expanded work search support. The UK Government will provide £895 million to enhance work search support by doubling the number of work coaches in Jobcentre Plus before the end of the financial year across Great Britain. 

 

Protecting Jobs 

5% VAT for goods and services supplied by the tourist and hospitality sectors

(HM Treasury, Plan for Jobs, 8 July 2020, link). 

 

  • A cut in VAT to 5 per cent for goods and services supplied by the tourism and hospitality sectors. VAT on food, accommodation and attractions will be cut to 5 per cent from next Wednesday for six months. This is a £4 billion catalyst benefiting over 150,000 businesses, and consumers everywhere - all helping to protect 2.4 million jobs. 

 

  • Eat Out to Help Out. The UK Government will introduce the Eat Out to Help Out scheme to encourage people to return to eating out. This will entitle every diner to a 50 per cent discount of up to £10 per head on their meal, at any participating restaurant, café, pub or other eligible food service establishment. The discount can be used unlimited times and will be valid Monday to Wednesday on any eat-in meal (including on non-alcoholic drinks) for the entire month of August 2020 across the UK. Participating establishments will be fully reimbursed for the discount. 

 

  • The tourism industry is worth more than £10 billion to Scotland’s economy. Tourists spent more than £5 billion in Scotland in 2018 and the wider effect on the economy is around £10.5 billion pounds. (Scottish Enterprise, February 2020, link). 

 

  • 218,000 people are employed in tourism in Scotland. Before the pandemic around 8 per cent of Scotland’s workers were employed in industries related to tourism. (Scottish Enterprise, February 2020, link). 

 

Delivering for Scotland 

 

  • Thanks to the measures announced today, the Scottish budget will increase by £800 million. 

 

  • This brings the total Barnett consequentials to help Scotland fight coronavirus to £4.6 billion. A pot of money greater than the entire education budget has been allocated to the Scottish Government through the Barnett formula, thanks to UK Government spending. 

 

  • More generally, the UK Government has spent more than £12 billion to support Scotland through coronavirus. This includes £4.6 billion in Barnett consequentials, nearly £5 billion in furlough payments, nearly £1 billion on the self-employed income support scheme, plus over £2 billion in business loans and benefit increases. These numbers are conservative estimates based on population share. (Scottish Conservative research). 

 

Reaction 

 

  • The Federation of Small Businesses have said the Job Retention Bonus of £1,000 will help SMEs. They said it was ‘A welcome measure from the Chancellor to help small businesses bring back staff who have been furloughed’ (FSB, Twitter, 8 July 2020, link). 

 

 

Q&A 

Q: The SNP have called for more borrowing powers? 

Scotland has already benefitted from over £12 billion of additional funding thanks to the UK Government – which has saved livelihoods, supported those most in need and topped up the Scottish budget. 

 

It’s time for the SNP to get on board with this Plan for Jobs and use the powers they’ve got to stimulate Scotland’s economy. 

 

Q: The SNP say this investment falls short of the required £80 billion UK-wide? 

Scotland alone has already benefitted from over £12 billion of additional funding thanks to the UK Government – which has saved livelihoods, supported those most in need and topped up the Scottish budget. 

 

It’s time for the SNP to get on board with this Plan for Jobs and use the powers they’ve got to stimulate Scotland’s economy. 

 

Q: Furlough extension? 

The Chancellor has already extended the Job retention Scheme until October. This is one of the most generous schemes of its kind anywhere in the world. 

 

And now he has announced that every business will receive an extra £1,000 for every member of staff they keep. 

 

I think it’s time the SNP started doing their bit - let’s not forget that pubs and cafes in Scotland are taking the SNP Government to court over their unfair business grant scheme. 

 

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