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UK unveils 2nd part of 3-phase plan for economic recovery

Jul '20
Pic: Shutterstock
Pic: Shutterstock
Chancellor of the exchequer Rishi Sunak recently announced a slew of measures to support jobs across the United Kingdom while delivering his Summer Economic Update in the parliament. The plan for jobs is the second part of a three-phase plan to secure the UK’s economic recovery from the novel coronavirus pandemic. The first was a £160-billion support package.

The first-phase plan included £49 billion of extra funding for the country’s vital public services, including the National Health Service, paying the wages of nearly 12 million people and supporting over a million businesses through grants, loans and rates cuts.

Sunak’s plan is designed to support jobs by focussing on skills and young people, creating jobs with investment in shovel-ready projects, greening the country’s infrastructure, protecting jobs through a value-added tax cut for the hospitality sector and a landmark ‘Eat Out to Help Out discount scheme for diners.

He said the third phase will focus on rebuilding, with a budget and spending review in the autumn.

As part of the plan to support jobs, a job retention bonus will be introduced to help firms keep furloughed workers. UK employers will receive a one-off bonus of £1,000 for each furloughed employee who is still employed as of January 31, 2021, according to information posted on the UK government website.

A new £2 billion Kickstart Scheme will also be launched to create hundreds of thousands of new, fully subsidised jobs for young people across the country. Those aged 16-24, claiming universal credit and at risk of long-term unemployment, will be eligible. Funding available for each six-month job placement will cover cent per cent of the national minimum wage for 25 hours a week, and employers will be able to top this wage up.

A total of £1.6 billion will be invested in scaling up employment support schemes, training and apprenticeships to help people looking for a job. Young people, who are amongst the worst hit by the crisis, will benefit from this.

Welcoming the chancellor’s support for employment and training, British Retail Consortium chief executive Helen Dickinson said time will tell if such measures can also bolster consumer demand, which remains well below pre-crisis levels, and the chancellor must be ready to take further actions if necessary.

The apprenticeship training landscape is in need of a shot in the arm and the chancellor’s announcement to incentivise apprenticeships will be welcome news for millions of people, he said, adding that the next steps must be to carry out a wholesale review of the apprenticeship system with the aim of creating more flexibility to enable the apprenticeship levy to meet the skills needs of retailers.

Fibre2Fashion News Desk (DS)

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