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Chancellor’s statement “a shot in the dark”

Key components of the Chancellor’s measures include:

  • A Jobs Retention Bonus, giving £1,000 to businesses who take employees off furlough
  • A temporary VAT cut for hospitality and tourism from 20% to 5%
  • An “Eat Out to Help Out” scheme for August, giving a discount to people eating at cafes, restaurants and pubs up to a maximum of £10 per head (Monday – Wednesday)
  • A rise in the threshold of stamp duty from £125,000 to £500,000
  • A “kickstart scheme” to get unemployed 16 to 24-year-olds into work
  • New payments for businesses hiring apprentices

Robert Alster, Head of Investment Services at investment management firm Close Brothers Asset Management, comments: “Unprecedented challenges require unprecedented solutions, which is what the Chancellor announced today. But it’s difficult to know whether enough is yet being done to secure the vast swathes of jobs currently at risk.

“At first glance, the job retention bonus looks attractive. However it is more likely to provide a welcome boost to employers already planning to bring workers back rather than forcing businesses to rethink layoffs. Job centre strengthening is welcome and necessary, as is the apprenticeship stimulus, and the cuts to both VAT and stamp duty. The hospitality support measures also show that the government is willing to think creatively about problem solving. But we must be clear. This is a shot in the dark, and one that must still be paid for at a later date. As ever, the proof of the pudding is in the eating, and it is on outcome rather than intent on which the government’s response will be judged.”

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