Value-Added Tax cut to be extended for hospitality sector — Rishi Sunak

Sunday, 27 Sep, 2020

Instead, he announced several other measures to help support businesses through the winter months.

And employers retaining furloughed staff on shorter hours can claim both the Jobs Support Scheme and the Jobs Retention Bonus.

Under the scheme, which begins on 1 November, the government will subsidise the pay of employees who are working fewer than normal hours due to lower demand in their industry.

Employers would have to pay half of the 67p the worker receives for each £1 of lost wages from the hours they do not work, in addition to the pay for the hours the worker does work.

The scheme will run for six months from November, with small- and medium-sized businesses eligible, as well as large businesses whose turnover has fallen during the pandemic.

Finer detail of Government's "Winter Economy Plan" have yet to be published but MHA MacIntyre Hudson's initial response picked up on assertions that the JSS has been created to support only viable jobs and cases where turnover has fallen among larger businesses.

UKHospitality CEO Kate Nicholls said in a statement: "The announcement of flexible employee support is a move in the right direction, but hospitality needs more targeted efforts to support jobs".

The chancellor said that the scheme was partially aimed at the hospitality sector which was rocked this week by the news of a nationally enforced 10pm curfew. Businesses have also been given extra time to pay loans for the Bounce Back Loan Scheme upto ten years and Coronavirus Business Interruption Loan Scheme which will be extended until the end of 2020. The level of grant will be calculated based on employee's usual salary, capped at £697.92 per month.

Back in the summer, as the government were easing Coronavirus restrictions across the country, the Chancellor made the announcement that his widely-praised Furlough Scheme would be ending on October 31st. Yet, with the increased restrictions introduced by Government earlier this week, it's looking unlikely that the sector will be able to return to work in a way that is financially viable over the next six months. "Understandable given need to adapt as economy changes..." It also says that the JSS will not help save jobs in the current climate. "With the United Kingdom remaining in crisis mode as coronavirus cases rise, ongoing, flexible financial support for businesses will be essential until the economy recovers". On top of this, the payment period for all coronavirus bounceback loans can be extended from six years to 10 and businesses that have one of these loans can apply to suspend repayments for up to six months.

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"We are now heading into the quietest part of any season, and the financial viability of a lot of businesses is very fragile".

"These sectors make up nearly 10 per cent of the regional economy and many have already been challenged by Covid-19".

"Many businesses are operating safely and viably, but they now face uncertainty and reduced demand over the winter months".

Opposition politicians have called for more emphasis on training for workers losing their jobs. To stand out to employers, highlighting skills has never been more important.

"The primary goal of our economic policy remains unchanged - to support people's jobs - but the way we achieve that must evolve", Sunak said, adding that the Conservative government wants to support viable jobs but not preserve those that are no longer needed. "The extension of support for the self-employed, which make up 70 per cent of the theatre sector's workforce, is also welcome, although we hope the new scheme will plug the gaps in the previous provision".

"Unfortunately, the second wave is well on its way and it's going to be a hard period for the United Kingdom job market".

It means workers will be paid two thirds of their salary for the hours they can't work. While more job opportunities are popping up every day, competition is rife, especially as people have been panicking about job security. If you click on them we may earn a small commission. The Chancellor has recognised that "we can't save every job". I can not save every job. The Institute for Fiscal Studies (IFS) said the end of furlough "likely to translate into sharply rising unemployment". It will help keep people in jobs, extend crucial support to businesses and giving them the certainty they need.

It is important the government steps up efforts to provide support to SMEs who form the backbone of Britain's economy.