Covid-19 Measures: What’s New?
We’re all familiar by now with the various emergency measures introduced earlier in the year to ease the financial shock to individuals, businesses and other organisations. But no one expected these measures to continue indefinitely.
Already, some retailers are closing their doors (or more accurately, not reopening at least some their stores) including retails giants such as Debenhams and John Lewis, along with well-known restaurant chains and other household names.
The range of measures were – are – vital to ensure the survival of businesses that would otherwise have folded as a result of the pandemic. The furlough scheme will close on 31 October and there’s also the moratorium on forfeiture of commercial leases; changes to Commercial Rent Arrears Recovery, limitations on statutory demands and winding up petitions, tax ‘pauses’ and so on.
Latest developments
A further tranche of measures, and announcements on existing measures, were unveiled by the Chancellor Rishi Sunak in his recent Summer Statement. Many of these anticipate the potential for a further shockwave well ahead of the end of the furlough scheme, for example, businesses looking at redundancy measures will be having to plan their arrangements now.
These are the headline points from the Summer Statement:
Hospitality sector: around 80% of hospitality firms stopped trading in April. An important announcement was that VAT on food, accommodation and attractions has been reduced to 5% until 12 January 2021
Also, everyone dining out throughout August will benefit from half price meals and drinks (excluding alcohol). It will be for restaurant owners to claim the discount direct from government via an online form.
Job retention: in a more puzzling move, all businesses will be paid a bonus of £1,000 for each furloughed employee retained for three months after the end of the furlough scheme. It will apply to all employees earning over £520 per month – whether or not the business planned to retain them anyway.
Stamp duty and homes: a temporary stamp duty exemption for the first £500,000 of all property sales (from 8 July 2020 until 31 March 2021) was announced. A petition is gaining traction to extend the exemption to all property buyers during the pandemic from 1 March 2020 though it’s unlikely to succeed.
From September this year, homeowners will be entitled to vouchers worth up to £10,000 for the costs of energy-saving home improvements including double glazing as part of the government’s drive to cut emissions. Under the scheme, government has pledged to pay at least two-thirds of the cost of energy-saving improvements to residential property.
Jobs creation: a new £2.1 billion ‘kickstart scheme’ was announced, to create more jobs for 16-24 year olds who are on universal credit and at risk of long-term employment by subsidising 6-month placements. Funding will cover 100% of the national minimum wage for 25 hours a week. Employers can top up this wage if they choose.
In a further move, businesses will be given £2,000 per new apprentice hired under the age of 25. This is on top of the £1,000 already paid by government for new 16-18-year-old apprentices (and those under 25 with an education, health and care plan).
Arts: a £1.6bn “lifeline” for the arts and heritage sector was announced but the details have not yet been published. We will provide more information when available.
Infrastructure: In addition to the grants for energy saving home improvements, the chancellor announced grants for public sector bodies to improve energy efficiency.
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