Covid-19: Economy Update

Rishi Sunak Excerpts

Thursday 22nd October 2020 Commons Chamber

[The Chancellor of the Exchequer (Rishi Sunak)]

Let me speak first to the people of Liverpool, Lancashire, South Yorkshire and Greater Manchester, and other areas moving into or already living under heightened health restrictions. I understand your frustration. People need to know that this is not forever; these are temporary restrictions to help control the spread of the virus. There are difficult days and weeks ahead, but we will get through this together. People are not on their own. We have an economic plan that will protect the jobs and livelihoods of the British people, wherever they live and whatever their situation. Just as we have throughout this crisis, we will listen and respond to people’s concerns as the situation demands.

I make no apology for responding to changing circumstances, so today we go further. The Prime Minister was right to outline a balanced approach to tackling coronavirus, taking the difficult decisions to save lives and keep the R rate down while doing everything in our power to protect the jobs and livelihoods of the British people. The evidence is clear: a regional, tiered approach is the right way to control the spread of the virus. My right hon. Friend the Chief Secretary to the Treasury yesterday set out for the House our economic support for businesses that are legally required to close. We are providing: billions of pounds of support for local authorities and a grant scheme for affected businesses, worth up to half a billion pounds every month. Of course, we also expanded the job support scheme, with the Government covering the cost of paying two thirds of people’s normal wages if their employer had been legally required to close. For areas in local alert level 3, we have made available over £1 billion of generous up-front grants, so that local authorities can support businesses, protect jobs and aid economic recovery in a fair and transparent way. That is our plan to support closed businesses.

But it is clear that even businesses that can stay open are facing profound economic uncertainty. This morning I met business and union representatives, including those from the hospitality industry, to discuss the new restrictions. Their message was clear. The impact of the health restrictions on their businesses is worse than they hoped. They recognise the importance of the tiered restrictions in controlling the spread of the virus, but a significant fall in consumer demand is causing profound economic harm to their industry. It is clear that they and other open but struggling businesses require further support, so I am taking three further steps today.

First, I am introducing a new grant scheme for businesses impacted by tier 2 restrictions, even if they are not legally closed. We will fund local authorities to provide businesses in their area with direct cash grants. It will be up to local authorities to decide how best to distribute the grants, giving them the necessary flexibility to respond to local economic circumstances, but I am providing enough funding to give every business premises in the hospitality, leisure and accommodation sectors a direct grant worth up to £2,100 for every month for which tier 2 restrictions apply. That is equivalent to 70% of the value of the grants available for closed businesses in tier 3. Crucially, I am pleased to confirm that these grants will be retrospective; businesses in any area that has been under enhanced restrictions can backdate their grants to August.

I have been listening to and engaging with colleagues around the House, including—but not only—my hon. Friends the Members for Heywood and Middleton (Chris Clarkson), for Hyndburn (Sara Britcliffe), for Penistone and Stocksbridge (Miriam Cates), for South Ribble (Katherine Fletcher), for Burnley (Antony Higginbotham), for Keighley (Robbie Moore), for Cheadle (Mary Robinson), for Leigh (James Grundy) and for Southport (Damien Moore), and I am pleased to confirm that the backdating of the new grants means that we are being more generous to the businesses and places that have been under higher restrictions for longer. Let no one say that this Government are not committed to supporting the people and businesses in every region and nation of the United Kingdom.

Secondly, to protect jobs we are making the job support scheme more generous for employers. If businesses are legally required to close, as we have already outlined, the Government will cover the full cost of employers paying two thirds of people’s salary where they cannot work for a week or more. For businesses that can open, it is now clear that the impact of restrictions on them is more significant than they had hoped, particularly for those in the hospitality sector. I am therefore making two changes to the short-time work scheme to make it easier for those businesses to keep staff on, rather than make them redundant: first, under the original scheme, employees had to work for 33% of their normal hours, whereas now we will ask them to work only 20% of those hours; and secondly, the employer contribution for the hours not worked will not be 33% as originally planned, or even 20% as it is in the October furlough scheme, but will reduce to 5%.

The scheme will apply to eligible businesses in all alert levels, so that businesses that are not closed, but which face higher restrictions in places such as Liverpool, Lancashire, South Yorkshire, and Greater Manchester, as well as the devolved nations, will be able to access greater support. These changes mean more employers can access the scheme and more jobs will be protected. We have made this one of the most generous versions of a short-time work scheme anywhere in the world. It is better for businesses, better for jobs and better for the economy.

Thirdly, as we increase the contribution we are making towards employees’ wages, I am increasing our contribution to the incomes of the self-employed as well. Today we are doubling the next round of self-employed income support from 20% to 40% of people’s incomes, increasing the maximum grant to £3,750. So far through this crisis, we have provided more than £13 billion of support to self-employed workers. Sole traders, small businesses and self-employed people are the dynamic entrepreneurial heart of our economy, and this Government are on their side.

In conclusion, a wage subsidy for closed businesses, a wage subsidy for open businesses, cash grants of over £2,000 a month for tier 2 businesses and up to £3,000 a month for closed businesses, support for local authorities, support for the self-employed, support for people’s jobs and incomes, all on top of over £200 billion of support since March. This is our plan—a plan for jobs, for businesses, for the regions, for the economy, for the country. A plan to support the British people. I commend this statement to the House.

[Anneliese Dodds (Oxford East) (Lab/Co-op)]

For months, we have urged the Chancellor to get ahead of the looming unemployment crisis and act to save jobs. Instead we have had a patchwork of poor ideas rushed out at the last minute: a bonus scheme that will pay £2.6 billion to businesses that do not need it; a job support scheme that simply was not going to work for the majority of businesses under pressure and that we said at the beginning did not do enough to incentivise employers to keep staff on; and an approach to support for areas entering tier 3 that has been nothing short of shambolic.

This has had real consequences. The deadline for large-scale redundancies came and went before the Chancellor announced the job support scheme, the deadline for small business redundancies passed before he realised that he needed to amend it, and many parts of our country have spent months under tier 2 restrictions without adequate support. How many jobs have been lost because of that inaction? Over a million have already gone. In the last quarter, we saw a record rise in redundancies. The Chancellor could have done much more if he had acted sooner.

Now we see yet another last-minute move. Let me ask the Chancellor. What has changed that means that this is the right thing to do now but it was not when parts of the north and midlands entered tier 2 many weeks ago? Does he agree with his own Mayor for the west midlands who said that

“this particular point was just one that was completely missed”.

Completely missed was the need for support for tier 2 areas. The Chancellor has only caught up and listened to the anxiety of workers and businesses when it looks like these restrictions will be affecting London and the west midlands. Will he apologise to those who have already lost their jobs and seen their businesses slip through their fingers in those areas that have not had that support until now?

The Chancellor referred to £1 billion of generous up-front grants for businesses and jobs provided in a “fair and transparent way”. There has not been a system of up-front grants for those in the north and midlands, and the process has not been fair and transparent for businesses and workers. To be honest, it is nothing short of insulting to describe what we have seen over the past few weeks as fair and transparent. The Government still have not published the formula that has been used for business support in tier 3 areas, and they still seem addicted to the approach where they say they are in negotiations with different areas but the reality is something completely different. When will he come clean about that support and the formula that is being used?

Will the Chancellor also make good on his Government’s claim that the JSS extension will be topped up to at least 80% for workers facing hardship? I know this is difficult for the Government. I see that the Prime Minister is sitting next to the Chancellor; he thought it would be topped up for everyone to 93%. I think that is what he said. Clearly the Government are not very sure on this, so maybe I can spell it out for them. That support does not amount to 80% for huge numbers of workers facing hardship—for example, those who have modest savings or who are excluded for other reasons, as so many are—and they have to wait five weeks anyway before they get that help. That could be fixed speedily by the Government, but they are refusing to do so. Does the Chancellor also recognise that those fixes for social security must apply to the self-employed, for whom an increase to just 40% of their previous income will not stave off hardship—and that is not to mention those who have been excluded throughout.

This is becoming like a long-running television show: the winter economy plan, series 3. But the twist is that it did not last the winter, it did not do enough to help the economy and it was not a plan. We have to get ahead of this crisis instead of always running to keep up. That is why Labour has called for a national circuit breaker to give us a chance to reset and to fix the broken test, trace and isolate system, but time is running out to implement that circuit breaker so that it includes half term and maximises the opportunity it brings. Will the Chancellor change course?

[Rishi Sunak]

This is the third time I have come to this House in several weeks to outline additional support for the economy, jobs and livelihoods. It is a sign of the seriousness of the economic situation we face, and I will never make any apology for acting fast as the moment demands and as the health situation evolves. But at the heart of this debate is a more fundamental difference on the right approach for protecting livelihoods and lives. We on this side of the House believe it is right to be honest about the hard choices we confront and about the fact that there is no easy cost-free answer. With every restriction comes difficulty, and that is why we are doing everything we can to strike that balance between saving lives and protecting livelihoods.

We have made progress, and that is why we are now able to operate a localised, tiered approach. That is why, even now, in the most affected areas we are striving to keep businesses open, and that is why the support I have announced today is as generous as it is, to give as many businesses and employers as possible the opportunity to keep working and keep trading. All this progress and all this hope are being put at risk by Labour Members’ repeated calls for a damaging, blunt, national lockdown. They will not say for how long, but they have already admitted that it would roll on with no clear end in sight. They will not say how many jobs would be lost through such a national lockdown. They claim that their approach—an indefinite series of national on-off lockdowns—would be better for the economy. I am afraid the facts simply do not support that conclusion.

The policies we have outlined today strike that balance. They support our approach—a localised, regional approach that is striving to get that balance between protecting jobs and protecting livelihoods. They will support people in every region and nation of this United Kingdom. They will protect people’s jobs. They will support their incomes and provide their families with security and with hope for the future.

Throughout this crisis, I have always stood ready to work with all hon. Members in every business group, industry group and trade union to work through solutions and deal with this crisis. While the situation evolves and the challenges change, my approach will not—to build consensus, to reach out to those with different views, to work past tribal political point scoring and to support our country through this moment of immense challenge so that we come out on the other side a stronger, more United Kingdom.

[Mel Stride (Central Devon) (Con) [V]]

I welcome my right hon. Friend’s statement. Once again, he has listened to businesses. When it comes to lockdowns—I have to say that I agree with the remarks he has just made about circuit breakers—may I draw his attention to the minutes of the Scientific Advisory Group for Emergencies meeting on 21 September, which state:

“Policy makers will need to consider analysis of economic impacts and the associated harms alongside this epidemiological assessment. This work is underway under the auspices of the Chief Economist.”?

Will my right hon. Friend update the House on the progress that has been made by the chief economist? Does my right hon. Friend agree that, to ensure a balanced public debate, the chief economist or a similar economic expert should join the epidemiologists for No. 10 covid press briefings?

[Rishi Sunak]

My right hon. Friend is absolutely right. The Opposition referenced the SAGE minutes but seemed to forget about that part of them, which rightly struck a balance between protecting jobs and protecting lives. He can rest assured that the Government will always do that. I may spare the chief economist the pleasure of attending the press conferences, but my right hon. Friend is right to say that that analysis is taking place. I have presented some of it at the press conferences, and I am happy to talk more about it at the Dispatch Box.

Fundamentally, my right hon. Friend knows, as I do, that our economy faces enormous strain. Almost three quarters of a million people have already lost their jobs, and, sadly, more will. That is why a regional, targeted approach is the right one. It allows us both to protect lives and to protect livelihoods.

[Alison Thewliss (Glasgow Central) (SNP) [V]]

This is the third statement from the Chancellor in the space of a month, but that is not a sign of good management; it is a sign of panic and chaos from this Government. None of this should be coming as a surprise to them. It is telling that the Government have put out more under embargo today than they gave out to the Opposition spokespeople—a sign of real disrespect to the other parties in this House.

We in the Opposition have called for more certainty and a plan, because the evidence is that we are not coming out of this coronavirus crisis any time soon. The Chancellor has not listened or responded, so I ask again for three things. I ask him to listen and to act; to extend furlough and the self-employment income support scheme at the rates from earlier in the year to protect jobs and livelihoods; and to fill the gaps and help those who are excluded completely from his support schemes. He knows that that is a problem, and he is choosing to ignore it.

I ask the Chancellor to keep the £20 uplift to universal credit and extend it to legacy benefits, including for those who have disabilities. Two thirds of the minimum wage is not enough to live on, and not everybody is entitled to universal credit. Huge gaps remain: carers, asylum seekers, those with disabilities and those with no recourse to public funds have all been left behind by this Government, with a cold, long winter ahead.

Significant sectors such as culture and the arts, hospitality, food and drink wholesalers, tourism, transport and aviation, and many more are not going back to normal any time soon, and they deserve Government support. Will the Chancellor align his support scheme with the Scottish Government’s public health proposals and those of the other devolved institutions?

UK Government support for Scotland does not go far enough to mitigate the local lockdowns that we have faced. The UK Government must now provide clarity on the Barnett consequentials to help us to plan and protect businesses and our people. The Scottish Government need this now—today—not in three months’ time, not eventually and not at some point in the future. We need it now, and the Chancellor should give clarity on it today so that the Scottish Government can act.

The Chancellor’s scheme has been full of holes. Time and time again, he comes here in a knee-jerk reaction, full of panic, rather than planning ahead for a situation that we told him would arise. This is nowhere near “whatever it takes”. I ask him to go further today, and to work with all the Opposition parties and the devolved institutions to get this right.

[Rishi Sunak]

When we outlined the original job support scheme, it was actually very warmly welcomed not only by various business groups, including the CBI, the Federation of Small Businesses and the chambers of commerce, but by the trade unions, because everyone at that moment recognised that it was a significant and generous intervention to protect the jobs and livelihoods of the British people. But the situation has changed. The health restrictions are having an impact, particularly in the hospitality sector, which the hon. Member for Oxford East (Anneliese Dodds) mentioned. That is why we have taken the steps that we have today. We are providing the certainty that she asked for, as this scheme will last for at least six months through to next spring. There is certainty over that. The grants we have outlined today will work on a monthly basis for as long as businesses are either in tier 2 restrictions or are closed under tier 3. Businesses can plan on that basis.

With regard to the Barnett consequentials, the Government will always ensure that people will benefit from this support wherever they are living in the United Kingdom. That is why we have provided an up-front guarantee to devolved nations worth £14 billion, which will help them also to plan at what is, I understand, a difficult time for everyone.

[Robert Largan (High Peak) (Con)]

I am really pleased that the Chancellor has listened and shown that this Government will always support the north. I am delighted that these tier 2 retrospective measures, such as the expansion of the job support scheme and the business grants, will make a massive difference to people living in Glossopdale in my constituency who have been under tier 2. On the business grants, may I urge the Chancellor to make certain that the money and the guidance on how that money can be used is made available to councils as soon as possible so that the businesses who need it can get it urgently and help to save jobs?

[Rishi Sunak]

My hon. Friend has been right to champion the situation for his local businesses. I know that they will warmly welcome this. I can give him the assurance that we will work as quickly as possible to provide the guidance. As I said, the grant value will be calculated on the number of hospitality, leisure and accommodation business premises, scaled by their rateable value. Added to that will be a 5% discretionary top-up, and then the local authority can use its discretion to allocate the money as it sees fit for its local area.

[Ms Angela Eagle (Wallasey) (Lab)]

It seems the Chancellor’s much-vaunted winter economic plan has not even lasted the autumn. His tinkering with the system demonstrates that he has been behind the curve all along, and it has sowed hardship and confusion. Why is the support he offered in March not being replicated as the virus comes back and we are suffering a second wave in October? Why is he trying to achieve local lockdowns on the cheap?

[Rishi Sunak]

I would not consider that providing £200 billion of total support could ever be accused of doing anything on the cheap. That money has gone to support public services like the NHS, and people’s jobs, livelihoods and businesses. I commit to this House that we will continue to do everything that is required, and continue to adapt and evolve as the circumstances demand.

[Sir Bernard Jenkin (Harwich and North Essex) (Con)]

I thank my right hon. Friend for bringing forward this package, for listening and for acting in the interests of the economy. Is it not essential that we align the interests of business and the economy with the interests of controlling the virus, rather than let those become polar opposites in argument with each other? Can we perhaps draw back from some of the partisanship that has soured relations over the past few days, because that does not do any good for public confidence in how we are all tackling this very difficult and wearing crisis?

[Rishi Sunak]

Those are wise words from my hon. Friend. He is right to highlight the importance, in this House and elsewhere, of our adopting a constructive and collegiate approach to tackling what is clearly a national crisis, and one that we will get through. We will get through it by working together and emerging stronger on the other side.

[Gerald Jones (Merthyr Tydfil and Rhymney) (Lab)]

From tomorrow, Wales will begin a 17-day firebreak lockdown to help to control the spread of the virus. During that period, there will be two support schemes from the Treasury as one ends and another one starts. The First Minister of Wales has asked the Chancellor to allow Welsh businesses to access the job support scheme a week early. He has refused, so a further request has been made to ease the rules on furlough for one week to allow people to get that support. We need to ensure that bureaucracy is reduced to allow Welsh businesses to protect jobs, so will the Chancellor be flexible, and what support, specifically, will he give to Welsh businesses?

[Rishi Sunak]

We have tried to reduce the bureaucracy by making sure that we do not have overlapping schemes at the same time. That would only increase complexity for businesses. We have endeavoured in all ways to provide support on a UK-wide basis, as I have said in conversations with the First Minister and others. We are doing this on a UK-wide basis in the knowledge that devolved nations are making individual decisions that ultimately the UK Government and UK taxpayer will be funding. That situation will work only if people can work in a constructive and aligned spirit, which is what I have said to all, and I very much hope that that can be continued in the coming months.

[Mr Andrew Mitchell (Sutton Coldfield) (Con)]

I greatly welcome my right hon. Friend’s statement. The measures he has announced are significant and generous, delivered in a manner that is fast becoming this Chancellor’s hallmark. May I thank him for hearing the powerful arguments advanced by the west midlands Mayor, Andy Street, especially in respect of the hospitality industry, and for addressing the serious business jeopardy that did lie between tiers 2 and 3?

[Rishi Sunak]

My right hon. Friend is right that the Mayor, Andy Street, has been vocal, and rightly so, in highlighting the particular impact of the tier 2 restrictions on the hospitality industry. That helped inform our decision to act today, with speed and scale, to provide support to those businesses, which will be warmly welcomed in his area.

[Patrick Grady (Glasgow North) (SNP)]

I wonder if the Chancellor regrets ruling out of hand the SNP’s calls in the spring for a universal basic income. Will he calculate what impact a minimum income guarantee like that would have had for employers, employees and the self-employed alike, and what the overall cost would be, compared with the billions he is finding for all these myriad schemes? Will he calculate the long-term costs of millions more on universal credit and other social security benefits, with the consequences of that on the economy and society?

[Rishi Sunak]

The Government do not agree with the universal basic income. It would not be right to provide money to millions of people who have absolutely no need of it; that would just detract our resources, which are targeted on those in most need, as has been our approach throughout the crisis.

With regard to universal credit and welfare, the Government believe that the best way to help people is to provide them with work and opportunity. That is why all our efforts are targeted on providing that support to protect as many jobs as possible while recognising that we cannot protect every single job. That is why we have also strengthened our safety net, with billions invested in universal credit and local housing allowance and, crucially, funding provided for new opportunities through training and apprenticeships to help people find fresh opportunity and a brighter future.

[Scott Benton (Blackpool South) (Con)]

Although I welcome the Chancellor’s statement, the imposition of tier 3 restrictions in Lancashire will inevitably mean that many of my constituents will be significantly worse off. While the additional funding for Lancashire, including the £42 million package, is welcome, there will still be far too many businesses who cannot access the Chancellor’s direct support. Hundreds of hotels in my constituency stand to lose thousands in lost bookings, but, because they have not been mandated to close, they will not be entitled to the additional support packages. Will he take steps to ensure that businesses such as small hotels, which are completely unviable under tier 3 restrictions, can access grants and the extended job support scheme?

--- Later in debate ---

[Rishi Sunak]

I am happy to tell my hon. Friend that the money provided to Lancashire, as it entered tier 3, for overall business support can be used precisely to help the businesses he rightly mentions that are being affected by the restrictions, even though they are open. That funding is there for the county council and other local authorities to do that. The enhanced generosity of the job support scheme I have announced will go a long way to helping those businesses as well, making it easy and affordable for them to get the wage support they need from the Government to protect as many jobs as possible.

[Christine Jardine (Edinburgh West) (LD)]

While I appreciate yet another partial U-turn from the Chancellor, what the country needs now more than anything is leadership, clarity and confidence that the Government are in control rather than this constant reaction and a patchwork with every hallmark of having been written on the back of a cigarette packet that we are getting from this Government. I plead with the Chancellor to consider going the whole way and keep the job retention scheme going after the end of October, let the devolved nations know what consequentials they will have—they need to plan as well—and give the country what he promised. He said he would do whatever it takes; this is not it.

[Rishi Sunak]

The hon. Lady asks for an extension of the job retention scheme. It is worth drawing her attention to the fact that the employer contribution to the job retention scheme in October is 20%, whereas under the new, more generous, job support scheme it has been reduced to 5%. That is more generous and will protect more jobs and more people’s livelihoods.

[Jim Shannon (Strangford) (DUP)]

I welcome the Chancellor’s commitment to helping the whole United Kingdom of Great Britain and Northern Ireland; we much value the money that has come forward. May I speak for the distribution sector, which daily delivers perishable foods not only to care homes, the NHS and schools, but to pubs, cafés and restaurants that are closed in tier 2 and 3 locations? The costs for distribution remain the same for jobs, vehicles and businesses. What help can those in the distribution sector access as a result of the Chancellor’s announcement?

[Rishi Sunak]

The hon. Gentleman makes an important point about the supply chains of those who serve the hospitality industry. I draw his attention to two things. The tier 2 grant programme that I announced today will contain a 5% discretionary top-up, which local authorities can use at their own discretion to support local businesses; they may choose to use some of it to address the needs that he outlines. Also, we have not targeted the enhanced generosity of the job support scheme purely at the hospitality industry, or indeed purely at businesses operating in tier 2 areas, because we recognise the complexity of the supply chains that he mentions. The very generous job support scheme will be available for all businesses in all parts of the country, regardless of sector, which I think will make an enormous difference to the businesses that he mentions.

[Matt Vickers (Stockton South) (Con)]

They say that good things come in small packages. Well, my right hon. Friend might be small, but he has delivered a huge package of job-saving, business-boosting support that will benefit the people of Stockton South and people right across the country. I thank the myth, the man, the legend who is my right hon. Friend for this life-saving support for businesses in my patch. Will he continue to review and react promptly to the ever-changing situation in his characteristically charismatic way?

[Rishi Sunak]

I am very grateful for my hon. Friend’s kind—I think—compliments; he knows that he is a large part of the reason why I am in this House, so he can take as much of the credit or blame for that as is required. I can give him the reassurance that he seeks. I have been delighted to visit his local businesses with him, and I know that he is an enormous champion for his local community, high streets and businesses. He works very hard on their behalf, and I know that the measures that we have announced today will make a difference to him and make sure that his community continues to be a thriving place.

[Navendu Mishra (Stockport) (Lab)]

Alan Gent runs the Petersgate Tap in my constituency. He employs five members of staff and the impact of the pandemic was already choking his business. He is not currently paying business rates, but his private landlord has rejected his request for a rent holiday, and now that Stockport is in tier 3, he cannot stay open. The support currently offered is woefully inadequate. Will the Chancellor now commit to addressing the real hardship of those who work in Stockport’s pubs, bars and hospitality sector?

[Rishi Sunak]

I have every sympathy with the hon. Gentleman’s constituent—I know what a difficult time it must be for him and his team and for those in similar industries—but actually I think that the support provided already will help him. The pub will be eligible for a business rate cash grant of up to £3,000 per month that he remains closed under tier 3 restrictions; across the UK, it will vary by place, but that should largely cover the vast majority of small and medium-sized pubs’ rental bills for that time. Of course, the five team members that the hon. Gentleman mentions could be put on the expanded job support scheme at essentially no cost to the employer. Those employees’ wages will be protected and covered by the Government.

[Andrew Jones (Harrogate and Knaresborough) (Con)]

I congratulate my right hon. Friend on his statement and thank him for all he is doing. Harrogate and Knaresborough is at the medium level, tier 1, but areas surrounding it are in the higher tier 2 category. Businesses have noted that with concern and are worried about what might happen should the position change and our tier be increased. The enhanced package will therefore be welcomed; I welcome it strongly. Does my right hon. Friend agree that the reduction in employer costs will result in more jobs being saved?

[Rishi Sunak]

As ever, I thank my hon. Friend for his thoughtful comments. He is right. That is why we took the decision to make this a universal approach, with enhanced generosity, to deal with the situation he mentioned of businesses operating in proximity to other areas under restrictions—those supply chains. This is a universal, generous approach, designed, as he said, with a lower employer contribution, to make sure that we can protect and support as many jobs as possible.

[Kerry McCarthy (Bristol East) (Lab)]

Back in March, the Chancellor said that those in the exhibition sector with physical properties and business rates would be eligible for the cash grant, but when they approached their local councils they found out that that was not true and that, because they did not open their premises to the public, they were not eligible. Exhibition companies in my constituency have received minimal support and are really struggling, and it looks like conferences and mass events will not go ahead until a vaccine is in place. It might not offer a photo opportunity like being a waiter at Wagamama, but may I urge the Chancellor to meet exhibition companies, including those in my constituency, and hear how much they are suffering?

[Rishi Sunak]

The hon. Lady might make disparaging comments about photo opportunities at Wagamama, but that was precisely because that sector employs 2 million people who are disproportionately lower paid, from ethnic minorities, younger and women. It is right that we focus our support on those in the hospitality sector, because they are particularly impacted by the restrictions.

The hon. Lady is right to highlight the plight of those in the events and exhibition industry. I am very sympathetic to that. Those businesses with business premises will receive business rates relief if they are in those categories. Indeed, the categories for the tier 2 grants that we have announced today will include hospitality, leisure and accommodation, under the Valuation Office Agency codes. Exhibition and events spaces are typically included in that, so they will be included in the calculation of the grant value provided to local authorities.

[Andrew Griffith (Arundel and South Downs) (Con)]

Business leaders I speak to, both in Arundel and South Downs and nationally, recognise that tailoring our response to the circumstances is a strength, not a weakness. They also know that there are no easy choices, but the worst of all worlds would be a blunt national circuit break, which would cost rather than save jobs.

[Rishi Sunak]

My hon. Friend is absolutely right on his last point. We are lucky to benefit from the considerable business experience that he brings to this place. He is right that, in business as in public policy, it is right that we evolve and adapt to the circumstances. That is what we have done today, but it is right that we do it in a targeted, tiered way, not with the blunt national instrument that, as he rightly says, would unnecessarily cause hardship and cost jobs.

[Alex Norris (Nottingham North) (Lab/Co-op)]

I understand that at half-past 4 today a Government Minister will meet local leaders in Nottingham to put us into the third tier. We had to find that out through the media, because local Members of Parliament have not been invited, which is saddening. If measures need to be taken to protect the health and wellbeing of our community, we will of course support them, but they will have a profound impact on our local economy. If Nottingham moves into tier 3 this afternoon, what package of support will the Chancellor put in place to protect our jobs and businesses?

[Rishi Sunak]

I know that it is a difficult time for the hon. Gentleman’s constituents, and he is right that they should engage constructively. I am glad that he and his local area are doing that. There will be a variety of support available. Closed businesses will receive grants of up to £3,000 a month, paid centrally. Obviously, similar to other areas, there will be a negotiation and a conversation with the Secretary of State for Housing, Communities and Local Government, which will result in an amount of support being provided for businesses. Of course, as the hon. Gentleman will know, there is also a formula to provide the local authority with support of up to £8 per head, and that money is used to enhance local compliance enforcement and contact tracing. I know that those conversations are ongoing and I very much hope that they will have a constructive outcome.

[Stephen Metcalfe (South Basildon and East Thurrock) (Con) [V]]

I warmly welcome my right hon. Friend’s statement and thank him for supporting people and businesses across Essex. Already more than 15,000 people have benefited from the furlough scheme, and more than 5,000 from the self-employment income support scheme. These additional measures to support those who have been adversely affected by the recent introduction of tier 2 in Essex are welcome. Will he confirm that he will continue to do whatever it takes to support our country and our economy?

[Rishi Sunak]

I can give my hon. Friend that assurance. He mentioned some numbers, and that is ultimately what it is about. We stand in this place and talk about many billions of pounds and policy, but often it is about the people and the jobs and livelihoods that we are trying to protect. I am delighted to hear that the 20,000 people he mentioned have benefited from the support that this Government have put in place, and I can give him and them the assurance that we will continue to do exactly that.

[Ben Lake (Ceredigion) (PC)]

As Wales enters a firebreak lockdown tomorrow evening, there are concerns that there will be a week-long gap in support between the end of the furlough scheme and the introduction of the new wage support scheme. It would be good if the Chancellor could consider giving Welsh businesses early access to that scheme. May I ask him to clarify the eligibility criteria, in particular whether seasonal workers will be eligible for support?

[Rishi Sunak]

There will not be any gap in support, I am pleased to tell the hon. Gentleman, because, as he knows, the CJRS runs all the way to the end of this month and the job support scheme starts on 1 November. There will be complete coverage and no interruption. We provided Barnett funding on the grants from the moment I announced them, so that is also available to the Welsh Government. With regard to the specific treatment of seasonal workers and the computation of the reference earnings, that is set out in the guidance for the CJRS and that will remain consistent in the new job support scheme.

[Richard Fuller (North East Bedfordshire) (Con)]

In his statement on 8 July, my right hon. Friend said his measures would be always

“unencumbered by dogma”

and

“driven always by the simple desire to do what is right.”—[Official Report, 8 July 2020; Vol. 678, c. 937.]

He was right then and he is right today in announcing these measures. I noted the extension in support for the self-employed, which will now extend all the way through to April. Will my right hon. Friend assure me that he is also working with the Health Secretary to ensure that we are doing whatever we can to get self-employed people and everyone else into work and back to work without restrictions as quickly as possible?

[Rishi Sunak]

My hon. Friend is absolutely right. The self-employed are a part of the entrepreneurial side of our economy that will help to drive our recovery. It is right that they receive support and I am proud that the support we have put in place—over £13 billion benefiting almost 3 million people—is one of the most comprehensive and generous packages of support for the self-employed. Ultimately, however, his last point is the one we should focus on. The best way to help people is to allow them to get on and do the job they love doing, and allow them to trade.

[Chris Bryant (Rhondda) (Lab)]

I am not going to quibble; I think all of this is good and I am delighted that it is being announced today. However, I just want to say to the Chancellor that some of the measures he has announced apply across the whole of the UK and some apply only in England. That provides a lot of confusion for a lot of ordinary people out in the country who do not watch what we are doing in here every day and do not follow every element of the minutiae. Will he clarify precisely how much of the money he is announcing today is really new money to be spent in England through local authorities on the new business grants in tier 2 areas? How much extra money—I do not want to know about the earlier £14 billion for the devolved nations—because of Barnett consequentials is now coming to Wales?

[Rishi Sunak]

I thank the hon. Gentleman for his comments. He is right and I can appreciate the confusion. We try to do things on a UK-wide level, but obviously not everything will be on that level. I cannot give him a precise figure, because these are demand-led schemes. What we have tried to do is provide upfront funding guarantees in advance of that demand being drawn down in England and the Barnett consequentials being delivered. We true those up on a regular basis—I am happy to write to him with further details—but we try to provide the funding to Wales, Scotland and Northern Ireland in advance of that demand actually occurring in England. I think that is a better and more generous approach for the devolved nations.

[Laura Trott (Sevenoaks) (Con)]

I welcome the Chancellor’s statement. Keeping a link to viable jobs is absolutely crucial, so does my right hon. Friend agree that it is better to keep businesses open and functioning where possible with support, rather than locking down nationally, multiple times?

[Rishi Sunak]

My hon. Friend is absolutely right. When I talk to both businesses and employees, they say that what they want is to be able to go to the jobs they love. They want to be able to do that. They want to be able to serve customers and they want to be able to welcome us all back to their restaurants, pubs, cafés and so on. She is right that we have to strike that balance. I think the approach that the Government have taken does that—it strikes that balance. The support we have put in place today will enable as many of those people to remain in their job working hard and hopefully have a fulfilling future to come.

[Deidre Brock (Edinburgh North and Leith) (SNP) [V]]

It is good to see the Chancellor has found the magic money tree of Tory myth and given it another shake, but the money needs to go to the self-employed, the smallest businesses and the poorest households. He will have total control of VAT soon. Will he look at cutting tax on household essentials? Will he target the support for job retention schemes at the smallest businesses, so they can continue to employ people, rather than offsetting the wage bill of some supermarkets? Tesco, Sainsbury’s and Waitrose are not feeling the pinch the way that small enterprises are feeling it. Will he send the cash where it will do the most good?

[Rishi Sunak]

The hon. Lady is right in saying that support should now be targeted at where it can make the most difference. That is why our approach has evolved through this crisis, and what was universal at the beginning and at the peak of the crisis has now evolved into a more targeted approach. To give one example, a difference between the job support scheme and the old furlough scheme is that now large businesses—precisely the kinds of businesses she mentioned—will not be able to access the job support scheme, especially with its new, more generous terms, unless that business is seeing revenue decline. That sensible change means that support is rightly targeted at smaller and medium-sized businesses that need our help at this difficult time, and not at the large businesses that are not seeing any change to their business model.

[Mr Speaker]

Let us head to Ludlow and Philip Dunne. There is no sound, so I call Naz Shah.

[Naz Shah (Bradford West) (Lab)]

I do not need to tell the Chancellor about the way we are going, with the economy plunging further into a crisis. The biggest thing that businesses in my constituency tell me is that uncertainty is their biggest enemy. We have now been under extra restrictions for more than 150 days. If we go into tier 3, and given that the Chancellor does not want a planned circuit breaker, what support will he give to businesses in my constituency of Bradford West? Importantly, how long should they be prepared for uncertainty?

[Rishi Sunak]

I am pleased to tell the hon. Lady that the tier 2 grants that I announced today will be backdated, so that her businesses and local authority will receive funding that is backdated to when they entered tier 2 restrictions. I think those grants worth up to £2,000 over a month will be of enormous support to businesses in her constituency, at what I appreciate is a difficult time.

[James Wild (North West Norfolk) (Con)]

Although Norfolk remains in tier 1, the additional support for hospitality, tourism and other businesses is welcome. As well as the short-term measures in this plan for jobs, looking longer term, will my right hon. Friend bring forward proposals in the spending review for tourism zones, including one for Norfolk and Suffolk? Will he accelerate the roll-out of gigabit broadband for businesses in North West Norfolk, so that they benefit sooner from greater connectivity?

[Rishi Sunak]

My hon. Friend regularly reminds us all about the importance of digital connectivity in rural areas such as his, and indeed mine, and he will know, as I do, that the Government are committed to bringing both gigabit-capable broadband and mobile phone networks to all the parts of our country that otherwise might not have as strong connectivity as they would like. I know he will join me in welcoming that, as it will make an enormous difference to the local economy in his and other rural areas.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab) [V]]

Twenty-three OECD countries had job subsidy schemes in place for a major event such as a pandemic, but unfortunately, the UK was not one of them. The Government’s piecemeal approach to the pandemic is leading many of my constituents to ask why we were so poorly prepared for it in every single way. In Oldham East and Saddleworth, unemployment has nearly doubled since March. We know now that across the country nearly 300,000 people were not eligible for social security support. A third of those people were disabled and one in 10 were from the north-west. How many low-income workers covered by this new financial package will be excluded from social security support to top up their wages?

[Rishi Sunak]

The hon. Lady is right to say that we did not have a wage support scheme when we entered this crisis, which is why I place on record my thanks to the fantastic team of officials at the Treasury and at HMRC for acting with unbelievable speed and decisiveness in helping me to create, design, and implement these schemes in record time, enabling us to help pay the wages and protect the jobs of more than 9 million people.

[Dr Luke Evans (Bosworth) (Con)]

Last night I had a meeting with the Hinckley business improvement district and met businesses that raised concerns about what would happen should they go into tier 2. At the time I told them that the Chancellor and the Treasury were listening, and I am pleased to welcome the support for businesses in tier 2, should my area move into that. In the spirit of listening, will the Chancellor consider providing a road map for businesses that are struggling the most, such as those running weddings, events and conferences and those in the travel industry, to try to provide some clarity and certainty going forward?

[Rishi Sunak]

I am grateful to my hon. Friend for raising this. He has raised with me the impact on businesses in his area of a potential move into tier 2, and I hope he will be reassured by the announcements today. Travel and events are interlinked. As he and I know, we must work to find a way to allow more travel to happen. The Transport Secretary has spoken to colleagues about that. He is actively engaged in working with industry and health professionals to see what more we can do to facilitate greater ease of travel, and therefore open up travel corridors and help our events industry.

[Stephen Farry (North Down) (Alliance) [V]]

It is important that the public health and economic support measures move in harmony. Northern Ireland had to go into tighter restrictions on 16 October, ahead of other parts of the UK. The 20% employer contribution in the outgoing job retention scheme is a major challenge for employers to keep jobs. Given that the Chancellor has shown some flexibility today, will he reconsider the timescale of the new scheme and backdate the 5% employer contribution to 16 October?

[Rishi Sunak]

Given that the grants are backdated, if that results in extra Barnett consequentials, of course that extra funding will flow to Northern Ireland, as it will to other devolved nations. With regard to the job support scheme, as I said, there will be no interruption of coverage between one scheme and the other. As the hon. Gentleman points out, the employer contribution will be significantly reduced on 1 November.

[Dehenna Davison (Bishop Auckland) (Con)]

I am incredibly grateful to my right hon. Friend and the whole Treasury team for their work, and I would especially like to thank my hon. Friend the Member for East Surrey (Claire Coutinho) for her engagement on this matter. I am already receiving messages from my constituents to say that they are delighted with these schemes. Bishop Auckland landlords will be helped out by this. I just have one question: how quickly can we expect these grants to hit businesses? I know that County Durham did an exceptional job of getting them out last time, but if he could provide a timeline, I would be grateful.

[Rishi Sunak]

I know that my hon. Friend is a proud champion of all her local pubs, judging by all her Instagram photos—I am very jealous. Having visited many of them with her during the campaign, I am glad that she is providing them with the support that they need at this difficult time. I know that these grants will make a difference. I can reassure her that we will work very quickly to get the guidance out. The funding will be available on a monthly basis; a month after the restrictions start, the funding will be there for those businesses.

[Martyn Day (Linlithgow and East Falkirk) (SNP) [V]]

The Chancellor has announced the latest package of covid measures, and we clearly face a further protracted period of the crisis, with more and more areas going into local restrictions. Given the regional packages announced for England, will the Chancellor tell us exactly what the Barnett consequentials will be, as devolved nations need to plan properly for their own mitigation measures?

[Rishi Sunak]

I refer the hon. Gentleman to my answer to the hon. Member for Rhondda (Chris Bryant). We have taken the approach of providing up-front funding guarantees to devolved nations, worth £14 billion currently, and we will update and review those regularly. In all ways, dealing with these demand-led schemes is difficult, which is why we have taken this approach, which is generous and better at providing up-front funding to devolved nations.

[Sir Robert Neill (Bromley and Chislehurst) (Con)]

The Chancellor’s measures will be welcomed by the hospitality sector in London, although I hope he might have a word with the Health Secretary about the point of a 10 pm curfew if it is members of a family dining together. Will he look carefully at support for the events sector? As he knows, that sector supports not only private events but many large corporate events. We have a great number of those of the highest quality in London. There are thousands of jobs and millions of pounds of turnover involved here, but because these businesses do not serve food directly to the public from their production kitchens, they have not so far been able to benefit from the business rate relief scheme. Can we look at those loopholes that they have been falling through?

[Rishi Sunak]

I thank my hon. Friend for his comments. Where the guidance is not clear on businesses that are legally required not to open but not legally closed and therefore do not benefit from some support, we are actively looking at that and ensuring that we can fix it. Events and exhibitions are one of the VOA categories that will be included in the hospitality and leisure calculation that we use for the tier 2 grants I have announced today. More generally, the best thing we can do is try to open up more travel and, as time progresses and we can do more testing, to get life back into that sector by allowing it to get on with what it wants to do, which is to put on a fantastic events.

[Nick Smith (Blaenau Gwent) (Lab)]

In March, the Government increased the basic allowances for both universal credit and working tax credit by £20 a week, but that uplift is only temporary; it will expire next April. Does the Chancellor accept that, after what we all expect to be a tough winter ahead, that will mean taking nearly £1,000 a year away from those families who really need it?

[Rishi Sunak]

We did put in place the temporary uplift of universal credit  but, as the hon. Gentleman says, it still has five or six months to run; it will be in place to support vulnerable families throughout the difficult winter period and is there all the way until next spring.

[Mr Gagan Mohindra (South West Hertfordshire) (Con)]

I welcome the measures announced today. As the Chancellor will be aware, 15,400 people have benefited from the furlough scheme in South West Hertfordshire, and I applaud the sustainable and affordable approach he has adopted. Does he agree that the approach needs to remain pragmatic, with an evolution of policy, to give more certainty to our communities?

[Rishi Sunak]

My hon. Friend is absolutely right. In the face of something we have never seen before—we are all grappling with how to deal with it—it is right that we remain pragmatic and flexible; it is not right to be wedded to dogma and be unwilling to change when the facts change. We will always do that, as we grapple with the health crisis and the economic crisis. We will remain flexible and nimble, but always with the same values and principles underlying what we do, which is to try to protect as many people’s jobs and livelihoods as we can.

[Kirsten Oswald (East Renfrewshire) (SNP) [V]]

The UK Government wax lyrical about a flexible labour market as a strength of the UK economy, but the Chancellor’s support packages have excluded millions and so many will continue to be excluded from support. So will he again look at provisions for the millions who still fall through the holes in his schemes? If he will not do the right thing by these excluded groups, will he please release the resources to devolved Administrations to allow them to do so?

[Rishi Sunak]

Our support for the self-employed remains among the most comprehensive and generous anywhere in the world, and is now approximating almost £13 billion for almost 3 million people. Barnett consequentials of more than £13 billion or £14 billion have been provided to the devolved nations and, if the Scottish Government choose to do something different with that, that is of course up to them.

[Stephanie Peacock (Barnsley East) (Lab)]

In the past six months, the number of people forced to claim unemployment benefit in Barnsley has doubled. If the Chancellor is saying that livelihoods have to be balanced against lives, should the people of Barnsley expect unemployment to rise, the death rate to rise, or both?

[Rishi Sunak]

It is exactly because we need to adopt a balanced approach that we have taken the more regional and tiered approach that we have. We never pretended there are easy choices here—it would be wrong to say otherwise. We are balancing protecting the economy and protecting people’s jobs and livelihoods while suppressing the virus, in the least damaging way possible. There is no perfect answer. As I said, there are no easy choices. But we will always be honest about that and try to tread that careful path between those two things. What would be more damaging for people’s jobs and livelihoods is a blunt national lockdown, which would inflict unnecessary hardship and suffering on people where the virus is not particularly rampant.

[Lucy Allan (Telford) (Con)]

Throughout this crisis, the Chancellor has shown himself to be adaptable, nimble, flexible, dextrous and agile—perhaps it is down to the Peloton bike or a yoga exercise. I do not know what it is down to, but those are critical skills, essential for success in any endeavour. I thank him from the bottom of my heart for the measures he has announced today, which will benefit my constituents, who have struggled so much to keep their livelihoods afloat. I am truly grateful to him. Does he agree that the sledgehammer blunt instrument of a circuit breaker or fire break—call it what you like, but that type of lockdown—would be devastating to our communities and our economy? Will he do everything he can to ensure that that does not happen?

[Rishi Sunak]

My hon. Friend is absolutely right, and I thank her for her warm words. She knows, as someone who is a huge champion of small businesses in her area, repeatedly bringing their concerns to this Chamber, how damaging it would be to inflict unnecessary pain and suffering on those businesses and those people’s jobs and livelihoods. That is why the Prime Minister’s and this Government’s approach of a regional, tiered strategy is absolutely the right one.

[Tony Lloyd (Rochdale) (Lab) [V]]

The Chancellor will recognise that, although the tier system is only a few weeks old, Greater Manchester has been de facto in tier 2 for three months, before moving into tier 3 this week. The Chancellor told the House, in reply to my hon. Friend the Member for Bradford West (Naz Shah), that these grants will now be retrospective. Can he be absolutely clear: will the grants for Greater Manchester go back to the beginning of our period of de facto tier 2 and not simply to when the Government introduced the more formal, legalistic tier 2?

[Rishi Sunak]

Yes, I can, and I hope I did, provide that reassurance. For all areas that have been suffering essentially de facto restrictions, as the hon. Gentleman said, we will backdate the grants through to the beginning of August as required, and that will benefit many local businesses in Greater Manchester. I am grateful for the representations I had on this matter from many colleagues around the House, including many of those I mentioned in my statement.

[Mr Speaker]

Let us head up to Yorkshire with Julian Sturdy.

--- Later in debate ---

[Neil Gray (Airdrie and Shotts) (SNP) [V]]

It has taken weeks for the Chancellor to tinker with his job support scheme to get it to a better place, as if he was surprised by the impact that the necessary public health restrictions would have; it really prompts the question why he did not just keep furlough. But the big question today is why he did not do anything about making the universal credit £20 per week lifeline permanent and extending it to legacy benefits, which would have disproportionately benefited disabled people at this difficult time.

[Rishi Sunak]

Maybe the hon. Gentleman knew something that the TUC and every other business group did not when they warmly welcomed the introduction of the job support scheme, but I am grateful to have his thoughts. He might also want to have a word with his colleague the hon. Member for Edinburgh North and Leith (Deidre Brock), who said that it was wrong to give support to large businesses that were benefiting from this crisis. That is exactly why it would be wrong to extend the furlough scheme. The job support scheme is more targeted in its approach, makes sure that those types of businesses are not able to access support and, as I have mentioned, is more generous to employers than the October furlough scheme.

[Huw Merriman (Bexhill and Battle) (Con)]

I warmly welcome the Chancellor’s statement and thank him and his colleagues, and indeed the Department, for everything they are doing. It would take the most churlish of people to claim that this is anything but flexible, nimble and massive support for business. I recognise that, in making the job support scheme more generous, the Chancellor is now providing support for businesses that are open, and that is absolutely welcome. What steps are being taken in respect of those businesses that are open and perhaps do not need as much support—or, indeed, there could be fraudulent claims—to protect the taxpayer?

--- Later in debate ---

[Rishi Sunak]

My hon. Friend is absolutely right, and that is why we have evolved our approach. Whereas earlier in this crisis, when we were facing something that was happening with enormous speed and severity, we erred on the side of being more universal in our approach and acting quickly, obviously, as time has progressed, we can be more targeted—more effective—to root out misuse of these schemes and make sure that support is targeted where it is most needed. As I said, one example of that is all the various new eligibility criteria for the job support scheme, ensuring that large businesses that are not suffering a revenue decline will not be able to access the scheme. There are also conditions around redundancy notices and the ability of large companies to make capital distributions while using the scheme. All those are sensible changes that go to the heart of what my hon. Friend said: we should target our support on those who really need it.

[Mr Speaker]

Let us return to Yorkshire with Julian Sturdy. I think he has got his voice back.

[Julian Sturdy [V]]

Thank you, Mr Speaker—take two. I thank my right hon. Friend for listening to the concerns that have been raised by York’s tourism and hospitality sector and announcing an extensive package of support for areas such as York that have been left in limbo under the tier 2 restrictions. However, does he agree that the best way to support York’s wider economy is to get us back to tier 1 as swiftly as possible? Can he assure me that the support announced today will not be used to justify prolonging additional restrictions for longer than is necessary?

[Rishi Sunak]

My hon. Friend is absolutely right: the best way to help businesses and protect people’s jobs is to allow businesses to trade and allow the economy to function as normally as possible. The support we have put in place today will not be used as an excuse not to do that, and as the Prime Minister said, we will be reviewing all these restrictions on a 28-day basis. Of course, we all want to see our local areas get back to as much of normality as they can, as quickly as possible.

[Emma Hardy (Kingston upon Hull West and Hessle) (Lab)]

One hundred and nine coach companies have gone bust, with 7,100 people made redundant, which is one sixth of the entire coach industry. Coach companies tell me that one reason for that is that they fall between gaps in support, being classified as neither tourism nor essential travel. Please will the Chancellor look urgently into what specific support can be given to the coach industry? Will the relevant Minister meet me and representatives of the sector to discuss their concerns?

[Rishi Sunak]

I am happy to organise for a relevant Minister to meet the hon. Lady. I hope that those companies—she is right about the difficult time they are experiencing—will have been able to access, for example, the bounce back loans or the coronavirus business interruption loans to help them with cash flow, and ditto with the VAT deferral and time to pay. But I appreciate that it is a difficult time for them, and the best thing we can do is allow more economic activity so they can get their coaches full as quickly as possible.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

I warmly welcome this package of support. Nevertheless, as the Chancellor has acknowledged, this will be a difficult winter for some businesses. When we move into what I hope will be a spring recovery, we will see the reintroduction of the full rates of VAT and business rates. Would my right hon. Friend consider phasing in the reintroduction of those at slightly lower levels to allow businesses to get back on their feet in these very important sectors?

[Rishi Sunak]

As ever, I am grateful for my hon. Friend’s advice and support. He is right: the business rates holiday we have put in place this year has provided over £10 billion of support to almost 1 million businesses. I know what a vital lifeline it is, so of course we keep all measures under review. Future fiscal policy is for Budgets, but I thank him for raising the point with me.

[Richard Burgon (Leeds East) (Lab) [V]]

When I previously asked the Chancellor about furloughed workers having to survive on less than the minimum wage, his callous response was that they would be “able to work elsewhere”, yet minimum wage workers in very high virus areas whose workplaces have been forced to shut will now have to live off just two thirds of the minimum wage. That is just £5.81 per hour—the minimum wage level of 11 years ago. Will the Chancellor introduce a wage floor so no such worker has to live off less than the minimum wage?

[Rishi Sunak]

We have addressed this point before, but I am happy to repeat it. Very low-paid workers will benefit from the flexibility and responsiveness of universal credit, and that is where the universal credit taper works. The way it works is that it will replace the falls in income with a top-up in universal credit worth about 63p in the pound. For example, a single person in their late 20s, working in hospitality and renting privately in a flat in a northern city, will receive about 92% of their original income on an after tax and after benefits basis.

[Gareth Davies (Grantham and Stamford) (Con)]

I too warmly welcome the Chancellor’s statement today. Does he agree with me that it is vital and absolutely right that we take this decisive action to support businesses and jobs today, but it is also important that we are mindful of the sustainability of public finances for tomorrow?

[Rishi Sunak]

My hon. Friend is absolutely right. He will have seen the figures from this week detailing the difficult situation of our public finances, with the scale of the borrowing and the scale of the increase in our debt this year. While right now our primary focus should be on supporting jobs and employment, given the restrictions in place, it is always right that we have one eye on the future. We must be careful not to mortgage our children’s futures, and that is why our interventions will be done in a way that is sustainable and affordable for the long term to ensure that we live within our means over time.

[Andrew Gwynne (Denton and Reddish) (Lab) [V]]

I was critical of the Chancellor on Tuesday, so I want to thank him for listening and acting on one of the key asks of all Greater Manchester MPs, of all the council leaders in our city region and, yes, of our Mayor, Andy Burnham, too. It was that our businesses and supply chains should be supported in tier 2, because we have had 12 weeks of these measures with no help and no support, and many really are struggling as we tip into a stricter tier 3. For some it will be too late, but I thank him for making this retrospective. How soon will these funds be released, because it is pressing, and what calculation has he made of the 12-week entitlement for Greater Manchester businesses?

[Rishi Sunak]

I am grateful to the hon. Gentleman for his comments. I would tell him that we will work very quickly with the Valuation Office Agency to calculate the value of those grants; we are just working through that detail. I hope to be able to provide him and all Manchester MPs with the figures as soon as possible, and we will of course release that funding as quickly as we have calculated the values.

[Saqib Bhatti (Meriden) (Con)]

On behalf of my constituents, may I thank the Chancellor for this comprehensive economic package? Clearly, he is a Chancellor who listens and I thank him for that. Will he join me in commending Andy Street, the Mayor of the West Midlands, who has campaigned passionately for further support? He is not a showboater; he just gets on with the job and gets things done.

[Rishi Sunak]

My hon. Friend is absolutely right. I am always grateful to hear from Mayor Andy Street. Andy has rightly put on the agenda the situation for businesses, especially hospitality businesses, in tier 2 areas, which my hon. Friend represents, and wanted me to be aware of what was happening. I am glad that today’s set of measures will make a difference to both my hon. Friend and Andy’s wider set of businesses and, I know, to many other businesses across the country.

[Bill Esterson (Sefton Central) (Lab) [V]]

The Chancellor says that he will support only viable businesses. Kim runs a wedding photography business. She is self-employed and works from home and, like millions of people, she has not qualified for any of the measures that the Chancellor has announced. Weddings will need photographers again, and Kim already has 71 bookings for next year. Why is the Chancellor’s message to Kim, and millions like her, that he thinks her business is not viable?

[Rishi Sunak]

If the hon. Member wants to write to me with Kim’s particular circumstances, I would be happy to see what various things we have done that may be of benefit to her and her business.

[Tom Hunt (Ipswich) (Con)]

I welcome this statement. It will ensure that the hospitality sector, even in those areas with much greater restrictions than my own, can hopefully keep going and come through this, as opposed to the approach of the Labour party, which would hammer the hospitality sector, even in areas such as mine, in Ipswich, where we currently have very low levels of covid. It will also give some reassurance to my constituents that, if the worst comes to the worst and cases increase, there is that additional support in place. One thing that these grants could be used on is winter heaters and gazebos, because we can still socialise outside in the winter months. I just wondered what the Chancellor’s thoughts were on that.

[Rishi Sunak]

That is an interesting idea. Obviously, for areas in tier 3, the local authorities are receiving funding to use at their discretion. It may well be that that is an idea they want to take up. Of course, for both open and closed businesses in tiers 2 or 3, I have announced a series of grants today and it will be up to those businesses to use them on whatever they want. Primarily, we assume that they will use them to cover the fixed costs of things such as rent, but, of course, it will be up to them what they use them for. None the less, my hon. Friend makes a good suggestion, which, together with our planning changes, means that those businesses can serve as many customers as possible, even though they face restrictions at the moment.

[Felicity Buchan (Kensington) (Con)]

I warmly welcome the additional support for tier 2 areas, such as my constituency in London. Does my right hon. Friend agree that we need to get London back into tier 1 as soon as possible as London is the engine of this country’s economy, accounting for 25% of all tax revenue?

[Rishi Sunak]

My hon. Friend is a rightly proud champion of her businesses in central London. Obviously, what is happening not just to our capital city but to all our city centres is incredibly sad. We all want to see them springing back to life and vibrancy. Hopefully, the measures that we have announced today will provide some support and breathing space to help them get through a difficult period until they can get back on their feet and do exactly what we want them to do, which is return to where they were—bustling and welcoming us all back into their shops and restaurants.

[Stella Creasy (Walthamstow) (Lab/Co-op) [V]]

The Chancellor says that he has been talking to the people who are worried about their livelihoods and the businesses facing redundancy, so he will know that those redundancies are falling particularly heavily on mums. We know from the data produced by the Office for National Statistics last month that 79% of the increase in redundancies has come from women, and we know that it is mums who are losing their jobs, but his Department is sitting on £1.7 billion of unspent tax-free childcare funding. Will he use that money to ensure that our childcare sector can support every parent who wants to get back to work and to stop the tsunami of unemployment that we are about to face?

[Rishi Sunak]

The hon. Lady is right to highlight the particular importance of good-quality childcare, which, as she said, enables mums to be able to protect their employment. I am happy to look at the specific suggestion that she mentioned, but I think that we have recently made—in the previous Budget and before—some changes to the operation of tax-free childcare, so that it is more available to more people. She is right that the take-up has not been what was forecast, which is why we put the changes in place to broaden the approach and broaden the eligibility for it, but I am happy to look at her specific suggestion.

[Dr Ben Spencer (Runnymede and Weybridge) (Con)]

I thank my right hon. Friend for the provisions announced today, which I very much welcome. My constituency is partly in tier 1 and partly in tier 2, and I especially welcome the support for tier 2 areas, but also across the board into tier 1. Many constituents who work in the wedding and events sector, or across its supply chains, have contacted me with difficulties due to restrictions, uncertainty and a drop in trade. Can my right hon. Friend confirm that today’s announcement will also support the events sector and, crucially, those working across its supply chain?

[Rishi Sunak]

It is precisely because we took a generous and universal approach to eligibility for the job support scheme, with its new generosity, that supply chains of all affected industries will be able to benefit. There were some calls that it should only be targeted at those in tier 2 areas, or, for example, only those in hospitality. We have taken the decision to ensure that the new job support scheme, with its new generosity, is available to all employers and all employees wherever they are in the UK. I think that will be of benefit to the industries and businesses that my hon. Friend mentioned.

[Clive Efford (Eltham) (Lab)]

There is no change in this announcement for people who are self-employed. A constituent of mine has contacted me. Back in March, she was assessed as earning too much to qualify for any assistance. Her income has now been revised down, but there is no way for her to appeal that original decision. This is no way to treat self-employed people. Can the Chancellor go away and look at these people who have fallen through the net?

[Rishi Sunak]

Perhaps the hon. Gentleman missed that part of the statement; I apologise if it was not clear, but we have doubled the value of the self-employed grants that will be paid in the winter from 20% to 40%, mirroring the increase in the Government’s support for those who are in employment and ensuring parity between self-employed and employed. As I have said, that is generous and comprehensive. With regard to the income threshold, yes, the hon. Gentleman is right; we have decided to target support for the self-employed at those who earn less than £50,000. That is 95% of all those who are majority self-employed. The average income of those 5% who are not included is about £200,000.

[Martin Vickers (Cleethorpes) (Con)]

I welcome the package announced by my right hon. Friend; he has quite rightly adapted the support that he is providing to the changing circumstances. May I look beyond the pandemic to the economic recovery, and urge continued support for my constituency in respect of the Greater Grimsby town deal? We also need broadband connectivity—and let me give a special mention in that regard for the village of Wold Newton. I know that he will be disappointed if I do not also mention free port status for Immingham and the Humber ports.

[Rishi Sunak]

My hon. Friend is absolutely right. It is important that we can look through this crisis to our economic recovery. I know that his area will play a starring role in helping to drive that recovery, whether that is through Grimsby or a free port in Immingham. I am pleased to say that we are making good progress on the free port process. I hope to announce the bidding process very soon, and look forward to receiving his local area’s application when the time is right.

[Dave Doogan (Angus) (SNP)]

The nature of the Government’s interventions in this crisis are reactionary and there are significant gaps in the support. A principal casualty of those gaps are the 3 million excluded, who have had a devastating summer. The Chancellor has used the word “generous” over 20 times in this statement, so I urge him to advise me what support he will now give to the 3 million excluded. Will he do them the service not of telling us how he has supported other people, but of telling us what he will do for them?

[Rishi Sunak]

The circumstances of everyone who is self-employed will be different. It may well be that they own a business premises, which will benefit from business rates relief or a cash grant. It may well be that they have used the bounce back loan scheme, as over a million small businesses have. It may be that they are benefiting from the enhanced welfare system and the improvements to universal credit and the local housing allowance. Or it may be that they are the self-employed people who today will benefit from a doubling of the grant that I have announced, which will be up to over £3,700 this Christmas. This remains one of the most comprehensive packages of support for those who are self-employed anywhere in the world.

[Dr Kieran Mullan (Crewe and Nantwich) (Con)]

On behalf of the Hop Pole pub in Wistaston, Hickory’s Smokehouse in Shavington, Pillory House in Nantwich, Giovanni’s in Crewe and Eight Farmers in Leighton, all of whom have been telling about the difficulties that they have been facing, I thank the Chancellor for the support measures that he has announced today, which will have a huge impact on their ability to get through this troubling time. Will he confirm when the support will be available and whether it will be backdated for those of us who have been in tier 2 for some time?

[Rishi Sunak]

If we are ending on this note, my hon. Friend has made me exceptionally hungry to hear that roll-call of great-sounding restaurants, which I hope I have a chance to visit with him. I can gladly give him that reassurance. We will be backdating the tier 2 grant support to the time that those restrictions were put in place, and I hope that will be of benefit to all the restaurants that he mentioned and many more small businesses in his constituency.

Royal Assent

[Mr Speaker]

I have to notify the House, in accordance with the Royal Assent Act 1967, that Her Majesty has signified her Royal Assent to the following Acts:

Sentencing Act 2020

Extradition (Provisional Arrest) Act 2020.

In order to allow the safe exit of hon. Members participating in this item of business and the safe arrival of those participating in the next, I suspend the House for a few minutes.

Oral Answers to Questions

Rishi Sunak Excerpts

Tuesday 20th October 2020 Commons Chamber

[Afzal Khan (Manchester, Gorton) (Lab)]

[The Chancellor of the Exchequer (Rishi Sunak)]

[Andrew Gwynne [V]]

[Rishi Sunak]

[Mrs Lewell-Buck]

[Rishi Sunak]

[Afzal Khan [V]]

[Rishi Sunak]

[Mel Stride (Central Devon) (Con) [V]]

[Rishi Sunak]

[Anneliese Dodds (Oxford East) (Lab/Co-op)]

[Rishi Sunak]

[Anneliese Dodds]

[Rishi Sunak]

[Alison Thewliss (Glasgow Central) (SNP) [V]]

[Rishi Sunak]

[Alison Thewliss]

[Rishi Sunak]

[Dr Kieran Mullan (Crewe and Nantwich) (Con)]

--- Later in debate ---

[Naz Shah (Bradford West) (Lab)]

[The Chancellor of the Exchequer (Rishi Sunak)]

[Zarah Sultana]

[Rishi Sunak]

[Naz Shah]

[Rishi Sunak]

[Imran Ahmad Khan (Wakefield) (Con)]

--- Later in debate ---

[Jacob Young (Redcar) (Con)]

[The Chancellor of the Exchequer (Rishi Sunak)]

[Jacob Young]

[Rishi Sunak]

[Bridget Phillipson (Houghton and Sunderland South) (Lab)]

[Rishi Sunak]

[Bridget Phillipson]

[Rishi Sunak]

[Mr John Baron (Basildon and Billericay) (Con) [V]]

[Rishi Sunak]

[Ian Byrne (Liverpool, West Derby) (Lab)]

[Rishi Sunak]

[Mrs Sheryll Murray (South East Cornwall) (Con)]

--- Later in debate ---

[Christian Wakeford (Bury South) (Con)]

[Rishi Sunak]

[Paul Holmes (Eastleigh) (Con)]

--- Later in debate ---

[Ruth Jones (Newport West) (Lab)]

[Rishi Sunak]

[Aaron Bell (Newcastle-under-Lyme) (Con)]

--- Later in debate ---

[Mr Speaker]

[Rishi Sunak]

[Mr Speaker]

Covid-19 Economic Support Package

Rishi Sunak Excerpts

Wednesday 14th October 2020 Commons Chamber

[The Chancellor of the Exchequer (Rishi Sunak)]

I beg to move an amendment, to leave out from “House” to end and add:

“welcomes the Government’s package of support worth over £200 billion to help protect jobs and businesses through the coronavirus pandemic, including the eight-month long Coronavirus Job Retention Scheme, Self-Employment Income Support Scheme, £1,000 Job Retention Bonus, unprecedented loan schemes, business grants and tax cuts; further welcomes the pledge to protect, create and support jobs through measures in the £30 billion Plan for Jobs such as Eat Out to Help Out, VAT and stamp duty cuts and the £2 billion Kickstart Scheme; acknowledges the further support for jobs with increased cash grants and the expanded Job Support Scheme to support those businesses legally required to close due to national or local lockdowns; and further acknowledges that this is one of the most comprehensive and generous packages of support anywhere in the world.”

I very much welcome the opportunity to update Parliament and the country on the economic challenges we face and our plan to tackle them. My message to hon. Members in all parts of the House is simply this: we must not shy away from the burden of responsibility to take decisions and to lead. We must do this with honesty and co-operation. We cannot allow the virus to take hold. We must prevent the strain on our NHS from becoming unbearable, but we must also acknowledge the stark reality of the economic and social impacts of another national lockdown. The costs of doing that are not abstract—they are real: they can be counted in jobs lost, businesses closed and children’s educations harmed; they can be measured in the permanent damage done to our economy, which will undermine our long-term ability to fund our NHS and our valued public services; and they can be measured in the increase in long-term health conditions that unemployment causes.

This is not about choosing one side or the other. It is not about taking decisions because they are popular. It is not about health versus wealth, or any other simplistic lens we choose to view this moment through. The Prime Minister was absolutely right when he set out our desire for a balanced approach, taking the difficult decisions to save lives and keep the R rate down, while doing everything in our power to protect the jobs and livelihoods of the British people. The evidence shows that a regional tiered approach is right, because it prevents rushing to another lockdown the entire country would suffer rather than targeting that support and preventing a lockdown in parts of the country where the virus rates are low.

This is an imperfect solution. We have been consistently honest about the difficulties and hard choices that this moment presents. We have heard a lot about the SAGE advice. The SAGE minutes themselves say that Ministers must consider the

“associated costs in terms of health and wellbeing”

and the economic impacts alongside any epidemiological assessment. It seems like the only people not prepared to confront that reality are in the Labour party, which is surprising given that just days ago the shadow Health Secretary said a new national lockdown would be “disastrous” for society and

“would cause unimaginable damage to our economy and…wellbeing.”

[Mr Perkins]

The Chancellor’s response would have more credibility if he was not stood there following month after month of failure by a Government whose testing and tracing regime—whose entire approach—got us to this point in the first place. We all recognise how expensive this is going to be, but it has happened because of the failure that he and his party have facilitated.

[Rishi Sunak]

The debate following this will address test and trace. It is worth bearing in mind that more than £12 billion has been invested in our test and trace capacity. Testing capacity has increased from simply 10,000 a day at the start of this crisis to close to 300,000 today, on its way up to half a million, and ours now ranks as one of the most comprehensive testing regimes anywhere in Europe.

[Andrew Griffith]

Does my right hon. Friend agree that, faced with a choice between a national blunt instrument that would wreak enormous economic damage, and something that is more finely calibrated region by region based on the science, there is no choice to make?

[Rishi Sunak]

My hon. Friend is absolutely right: it is a blunt instrument. It would cause needless damage to parts of our country where virus rates are low.

[Several hon. Members rose—]

[Rishi Sunak]

Having spent weeks indulging themselves with political attacks on this Government’s efforts to protect jobs, Labour have now flipped and support a blunt national lockdown. They will not say how much damage that will do to jobs or livelihoods, they will not say how they plan to support businesses through it, and they do not seem to care about the long-term stability of the public finances. If they did—[Interruption.]

[Mr Speaker]

Order. I am sorry, Chancellor. Please, I cannot hear the Chancellor. I want to hear him, and I am sure people outside the House want to hear him, so please, if he is going to give way—the Chancellor is a generous man—he will give way. In the meantime, I do not need people shouting.

[Rishi Sunak]

Thank you, Mr Speaker. If they did care, we would hear from the shadow Chancellor how many jobs Labour’s lockdown would cost.

[Alex Cunningham (Stockton North) (Lab)]

I am grateful to the generous Chancellor for giving way. Today, the North East Child Poverty Commission said that 35% of children in the north-east region are living in poverty. As a direct result of Conservative policies, we are going to see that number increase. What is he going to do about those children?

[Rishi Sunak]

The most vulnerable have been at the forefront of our mind throughout this crisis, which is why it is clear from the distributional impact of our interventions, which was published over the summer, that they have benefited those on the lowest incomes the most. It is there in black and white: a Conservative Government making sure the most vulnerable are protected through this crisis.

Any responsible party of government would acknowledge the economic cost of a blunt national lockdown. The Labour party may say it has a plan, but be under no illusion: a plan blind to the hard choices we face—a plan blind to and detached from reality—is no plan at all.

[Ms Angela Eagle]

In the Liverpool city region, which contains my constituency of Wallasey, there is £40 million of unspent support for business that the Chancellor generously granted in the first wave of the pandemic. Given that we are in tier 3, will he say today at the Dispatch Box that he will release that £40 million so that the local authorities in the Liverpool city region can apply that money to help their local businesses during this highest level of lockdown that we are suffering at the moment?

[Rishi Sunak]

I know what a difficult time this is for the hon. Lady and her constituents. With regard to underspends—I will come on to this later—I think it is wrong to think of them in that way. That was the Government giving an advance to local authorities to make payments to businesses. That was done on the basis that every local authority will have a wildly different degree of overspend or underspend, which we true up at the end of the process. We could equally have asked local authorities to make payments themselves and reimbursed them afterwards. There is significant financial support both for her local authority and the businesses in her area that have closed down. That was announced by the Prime Minister and I will come on to address that in detail later. It is right that that support is there.

Let me reiterate our plan. The House will be well aware of the gravity of our economic situation. The latest figures show that our economy grew by 6% in July and 2% in August, but it remains almost 10% smaller than it was before coronavirus hit. Business investment suffered a record fall in the second quarter of this year. Consumer sentiment remains well below its long-run average. Despite the significant support we have provided, the data is beginning to reveal the true extent of the damage that coronavirus has caused our labour market. The latest statistics published just yesterday show employment falling, unemployment rising and welfare claims rising. The revisions that the Office for National Statistics has made to its previous estimates show that unemployment was higher than it thought over the summer.

I have talked about facing up to the difficult truths clearly, and we are facing an economic emergency, but we are acting on a scale commensurate with this emergency as we address my single biggest priority: to protect people’s jobs and their livelihoods. We have put in place a comprehensive plan to protect, support and create jobs in every region and nation of the United Kingdom. Through more than £200 billion of support since March, we are: protecting more than 9.5 million jobs through the job retention schemes; strengthening our welfare safety net with an extra £9 billion for the lowest paid and most vulnerable; granting more than £13.5 billion to those who are self-employed, with further grants to come; and protecting over 1 million small and medium-sized businesses through £100 billion of tax cuts, tax deferrals, direct grants and Government-backed loans.

[Kevin Hollinrake]

Does my right hon. Friend agree that the best way to protect jobs is to keep the economy open wherever possible? Most other nations are using a local-restrictions approach to deal with this situation, including Germany, which is using lockdowns at a district level, not even at a state or county level. Does he agree that that is the best way forward?

[Rishi Sunak]

My hon. Friend is absolutely right. The only sustainable way to protect jobs in the long run is to have an economy that is open and functioning. No amount of support can make up for that.

There are other things we have done: eased repayment terms on those loans through pay as you grow; delivered on our promise to give the NHS what it needs; backed hundreds of thousands of young people to find good jobs through the kickstart scheme and new investment in training and apprenticeships; created green jobs through the £2 billion green grant programme; showed that we are here for our cultural sector, with the cultural recovery fund and a further support package for charities; and invested hundreds of billions of pounds in the largest, most sustained programme of infrastructure investment the UK has seen in decades. That is comprehensive action to protect the jobs and livelihoods of the British people. It undermines the credibility of the Labour party that, in the face of all that support, it continues to pretend that insufficient action is being taken.

[Rachael Maskell (York Central) (Lab/Co-op)]

Will the Chancellor give way?

[Rishi Sunak]

I will make some progress.

As the crisis evolves, our economic response will also evolve. What we will see over the winter is a complex picture of some businesses able to open safely and others being ordered to close to control the spread of the virus. Our winter economy plan provides a toolkit to protect jobs and businesses over the difficult weeks and months to come. The plan has three parts.

First, the job support scheme will protect jobs in businesses that are open or closed. If businesses can open safely, but with reduced or uncertain demand, the Government will directly subsidise people’s wages over the winter, giving those employers the option to bring people back to work on shorter hours rather than making them redundant. We are expanding the job support scheme to give more support to businesses that are ordered to close. For people unable to work for one week or more, their employer will still be able to pay them two thirds of their normal salary and the UK Government will cover the cost. This national programme will benefit people the same wherever they live and whatever job they do.

[Mr Perkins]

There seems to be a basic dishonesty at the heart of these tier 2 plans. There is no support for pubs. They are being told that they are allowed to stay open, but the measures being brought in are making them unviable. At least with our approach what we would see is a short-term hit, but then a reduction in the rate and more of a chance for us to return to normality. Will he at least admit that those pubs in tier 2 areas are not going to have viable businesses and say something about what he will do to support them?

[Rishi Sunak]

I am glad that there has finally been some acknowledgment that there will be a hit to businesses and jobs from what the Labour party is suggesting. It is right that there is support provided for hospitality, which is why the Government have provided a VAT reduction, a business rates holiday, direct cash grants, eat out to help out and now the job support scheme that is directly there to support those businesses that are open and operating but not at the same levels that they were previously. To give those businesses and their employees certainty, rather than the weeks that I heard about from the hon. Member for Oxford East, this scheme will run for six months through to the spring. This job support scheme is in line with those in most other European countries and, to support the lowest paid through this crisis, we have made our welfare system more generous and responsive too.

[Rachael Maskell]

The Chancellor will know from York’s economic base and the complexity of our economy that unemployment may rise to 27% in our city. What additional measures will he put in place to build the bridge to get us through this really difficult period? The job support scheme will just not deliver for my constituents.

[Rishi Sunak]

The job support scheme was widely welcomed not just by businesses groups such as the CBI and the Federation of Small Businesses but by the TUC, which I was happy to work closely with to design the scheme. However, she is right. That is not the only thing that we will do to support jobs, which is why we have put in place the £2 billion kickstart scheme to provide fully funded job placements for those young people most affected by this crisis and most at risk of unemployment. Thousands of those young kickstarters will be starting their new jobs this autumn.

[Miriam Cates (Penistone and Stocksbridge) (Con)]

Does my right hon. Friend agree that, while we all want simple solutions to this crisis—whether that is the Opposition suggesting full lockdown or an unlimited extension to furlough—there are no simple solutions. This is a highly complex problem. Every intervention and every support scheme will be nuanced and will have to be regionally effective There are no simple solutions. We should not be looking for simple solutions; we should be looking for the right ones.

[Rishi Sunak]

As ever, my hon. Friend is spot on. It is not leadership to shy away from the hard choices and real trade-offs that these decisions take. She is absolutely right.

The second part of our winter plan is to support businesses that are legally required to close, and we heard about that previously. Those businesses will now be able to claim a cash grant of up to £3,000 per month depending on the value of their property. Those grants can be used for any business cost and will not need to be repaid. I have also guaranteed £1.3 billion of funding for the Scottish, Welsh and Northern Ireland Administrations so that they can choose to do something similar. The hon. Member for Oxford East asked whether other areas had received that support, and was under the impression that none other had. I can correct the facts. Bolton is the only other area that has faced hospitality restrictions in that way and Bolton Council has received, at the last count, I believe almost £200,000 of support to compensate its businesses because they have been closed in a similar way.

[Anneliese Dodds]

I fear that the Chancellor is confused. I was not talking about the much-trumpeted local restriction support grant. He is right; it has been applied so far only to that one area of Bolton. I was talking about the business support that was delivered to Leicester, Oadby and Wigston, which I believe has not been provided to any other part of the country.

[Rishi Sunak]

It is the same type of support—support provided to the local authority to help their businesses. That was the question the hon. Lady asked my hon. Friend the Member for Harborough (Neil O’Brien), and I am happy to answer it.

The third part of our plan is to provide additional funding for local authorities. Again, I am happy to correct what may be a misunderstanding of the situation for the hon. Member for Oxford East. It is not the case that that support is only for local authorities in tier 3. There is a scaled structure. All local authorities placed into different tiers will receive extra financial support on a per capita basis, using the funding formula that my right hon. Friend the Chief Secretary is implementing. That funding will be worth up to almost half a billion pounds on a national basis, to support local areas and their public health teams with their local response, whether that is more enforcement, compliance or contact tracing. That comes on top of the almost £1 billion announced by my right hon. Friend the Prime Minister that we will provide to all local authorities, as we talk to them about their needs over this difficult period, to ensure that they can provide the services they need to. That also comes on top of the £3.7 billion already provided to local authorities.

This Government are dealing with the world as it is. While the hon. Member for Oxford East may not wish to confront that reality, I do not have that luxury. We cannot just let the virus take hold, but nor can we blithely fall into another national spring-style lockdown, as the Labour party wants to, rather than following our regional, tiered and localised approach. We are dealing with a once-in-a-century event, and I can assure Members on both sides of the House that the Government are doing all they can to support the country through this crisis.

We need a balanced approach, we need a consistent approach, and—as you will have seen, Mr Speaker—we also want a co-operative approach. But any responsible party calling for a shutdown of our entire country should be honest about the potential economic and social costs of such a dramatic measure. At the very least, they should have the integrity to acknowledge that what they are proposing will cause significant damage to people’s lives and livelihoods. I have never said that there are easy choices or cost-free answers. This is the reality we face, and it would be dishonest to ignore that truth. So no more political games and cheap shots from the sidelines. The Labour party can either be part of this solution or part of the problem. It is called leadership, but from them, I am not holding my breath.

[Mr Speaker]

There will be a four-minute limit on speeches after the SNP spokesperson. I call David Linden.

--- Later in debate ---

[David Linden]

I am not sure that the official Opposition are proposing multiple circuit breaks, to be fair to them, but it is not my job to defend the policy of the Labour party. However, what I will defend is the approach of the SNP Scottish Government, who are trying to do this in a balanced way, but we would like to see a lot more financial flexibility to do that. It would help if the UK Government gave us those financial powers. That is what I would say to the hon. Gentleman on that.

I want to come on to that very point, and highlight the work that the Scottish Government have done in supporting business during the second wave of the pandemic. The Scottish Government’s total package for businesses is over £2.3 billion. That is more than the consequentials received from the UK Government. As I mentioned to the hon. Member for Totnes (Anthony Mangnall), the Scottish Government are making an additional £40 million available to support businesses that will be affected by the new measures, and will work with affected sectors in the coming days. I am in no doubt of that. My city of Glasgow is one of those that have been under local lockdown restrictions, and the restaurants and bars in my constituency have had to shut down, but we have recognised when we have asked them to shut down, which is a way of trying to reduce the spread of the virus, that support must be coming.

The Scottish Government will continue to discuss with businesses how the support package we have offered can mitigate some or all of the employer’s contribution to the UK job retention scheme. We have put in place a £230 million “restart the economy” capital stimulus package to help stimulate the economy following the pandemic. We have announced details of a £38 million package of support for innovative early stage businesses. We have committed £2.2 million of funding to the Music Venue Trust, which will provide stability to grassroots music venues over the coming months.

What all this should highlight is that the UK Government’s financial plans have been and continue to be inadequate—excluding the self-employed, freelancers and artists; prematurely ending the furlough scheme; and refusing to make permanent the £20 increase in universal credit. Where we have had the power, the Scottish Government have spent £6.5 billion on tackling covid—above the Barnett consequentials—and they are doing all they can and all within their powers to support businesses across Scotland.

That is the issue at hand. There is only so much that the Scottish Government can do when the vast majority of Scotland’s tax and spending decisions are taken here in Westminster. The fact is that the Government cancelling the UK Budget simply demonstrates that Scotland remains an afterthought for the Tories. I would be more than happy to give way to the Chancellor if he can stand up and give some sort of clarity to Scotland’s Cabinet Secretary for Finance about what budget we are supposed to set when the Government have just gone ahead in this way.

[Rishi Sunak]

I have addressed this previously, in this place and others. There is absolutely no bar on the Scottish Government setting a Budget in advance of the UK Budget. The fiscal framework itself allows for that very possibility. That is exactly what happened at the start of this year, so there is simply no reason why that cannot happen. The OBR forecasts were provided as normal this autumn. Those forecasts are used by officials to make all the necessary calculations. It is simply wrong to suggest that the Scottish Government are unable to set a Budget until the UK Government have.

[David Linden]

Conservative Governments used to be really good on upholding the rule of law, and Conservative Governments used to be really good when it came to managing the economy, but we now have a Chancellor who appears to want the Scottish Government to set a completely blind Budget. For somebody who tries to advocate the idea of fiscal responsibility, that strikes me as rather bizarre.

People in Scotland are increasingly aware that the only way to move forward in terms of protecting our economy, managing our own finances and standing on our own two feet is with the powers of independence. With the United Kingdom Internal Market Bill destroying their hard-fought devolution, more and more Scots are supporting the SNP in calling for independence.

An Ipsos MORI poll revealed yesterday that 65% of people in Scotland think Britain is heading in the “wrong direction” compared with just 12% who think Britain is heading in the “right direction”. If we want to continue looking at polling, and I know the UK Government are doing quite a lot of polling on this issue at the moment—they are being a bit coy about releasing it—Ipsos MORI released a poll today showing that 58% of Scots now support Scottish independence.

I suggest to the Chancellor of the Exchequer that that backs up the point that people in Scotland can see this UK Government are not doing enough, and therefore they want to see these powers being transferred to Scotland so we can take our own decisions on these issues.

Job Support Scheme and Local Restrictions Support Grant

Rishi Sunak Excerpts

Monday 12th October 2020 Written Statements

[The Chancellor of the Exchequer (Rishi Sunak)]

Following my announcement on Friday 9 October that I am expanding the job support scheme (JSS), and increasing the generosity and frequency of local restrictions support grants, I am pleased to share more detail of these schemes and how this Government are supporting and protecting jobs and livelihoods.



The JSS is being expanded to provide temporary, localised support to businesses across the UK whose premises are legally required to close as a direct result of coronavirus restrictions set by one or more of the four Governments of the UK.



This expansion of the JSS will help businesses through the period they are affected by these restrictions, supporting the wage costs of employees in eligible premises who have been instructed to cease work and comply with this instruction. This scheme will enable those premises to reopen as quickly as possible when they can. It will help protect employee incomes, limit unemployment and maintain employer-employee matches.



This is part of the job support scheme, available to employers from 1 November 2020 for six months, with the scheme reviewed in January. Further guidance will be published in the coming weeks. Employers will be able to make a claim in arrears on a monthly basis online through www.gov.uk from early December 2020.



The coronavirus job retention scheme (CJRS) remains in place until 31 October, and flexibility in the system means if an employer is required to close in October, eligible employees can be furloughed until 31 October. The new job support scheme is available from 1 November, with payments from early December. Eligible employees whose employers use the expanded JSS will continue to be paid by their employer throughout this period. Neither the employer nor the employee needs to have previously used the CJRS to be eligible for the expanded JSS.



In line with the rules for the JSS already announced: all employers with a UK bank account and a UK PAYE scheme registered on or before 23 September can claim the scheme. Only employees that are on their employer’s payroll by 23 September are eligible. This means a real time information (RTI) submission notifying payment of that employee to HMRC must have been made on or before this date. This scheme will cover businesses that, as a result of restrictions set by one or more of the four Governments in the UK, are legally required to close their premises. This includes businesses told to provide only delivery and/or collection services from their premises. This scheme is open to employers across the UK, and we look forward to working constructively with the devolved administrations to ensure it operates effectively in all four nations.



The scheme will pay a grant to the employer calculated based on the number of eligible employees who cannot work at the relevant premises—which has been required to close by Government. Employers will only be able to use the scheme for employees who have been instructed to cease work—paid or unpaid for that employer.



Eligible employees cannot work for a minimum of seven consecutive (or calendar) days. An employee can return at a later date. Claims must not overlap and must be made monthly in arrears. These payments will be taxable, and employers will be required to cover employer NICS and automatic enrolment pension contributions in full, where applicable, but are not required to make further contribution to wage costs. However, employers can top up employee pay if they wish.



In line with JSS payments for hours not worked, the grant per eligible employee available from the UK Government is two-thirds of their normal pay up to a limit of £2,100 per month. Further detail on how normal pay is calculated will be set out in guidance. If an employer is closed by Government regulations then they can claim under the applicable rules. When that changes and they are able to reopen they can claim under the wider JSS for firms facing reduced demand under the criteria we outlined in September. Employers will be able to claim the job retention bonus for employees provided they are eligible. JSS grants can be used by employers to pay an employee's wages and help meet the JRB minimum income threshold.



The employer must use the scheme to cover their employees’ wages and pay relevant payroll taxes. The whole of the grant must be used to meet employee costs. The grant will not cover class 1 employer NICs or pension contributions, although these contributions will remain payable by the employer. Payments will be made in arrears, reimbursing the employer for the Government’s contribution.



On 9 September, the Government announced the local restrictions support grant scheme. This scheme provided businesses which are forced to close for three weeks or more due to a nationally imposed local lockdown in England with grants of up to £1,500 per three-week closure period.



The Government are now making this scheme more generous so that businesses receive up to £3,000 per month, and are eligible for payment sooner, after only two weeks of closure rather than three. The Government are also extending the scheme to include businesses which have been required to close on a national rather than a local basis, or which have not been legally able to reopen since the first lockdown in March.



Businesses will receive the following:



For properties with a rateable value of £15,000 or under, grants to be £1,334 per month, or £667 per two weeks;

For properties with a rateable value of between £15,000 and £51,000 grants to be £2,000 per month, or £1,000 per two weeks;

For properties with a rateable value of £51,000 or over grants to be £3,000 per month, or £1,500 per two weeks;

Local Authorities will continue to receive 5% of the funding which they received for the local restrictions support grant scheme as a discretionary fund, which the Government will encourage them to use to support business that have been legally mandated to close by the Government but are outside of the business rates system.



Grants will be administered by local authorities, and eligible businesses will probably need to provide their details to their local authority to access this support.

[HCWS503]

Treasury

Rishi Sunak Excerpts

Tuesday 29th September 2020 Ministerial Corrections

[Greg Smith (Buckingham) (Con)]

I warmly welcome the enormous package of measures outlined by the Chancellor. This morning, I spoke to Energy Generator Hire in Kimble Wick in my constituency, which has lost most of its order book and is uncertain about the future. Can he confirm whether event hire companies are included in the envelope of leisure and hospitality?

[Rishi Sunak]

Those that have business properties will be eligible both for the relief and the grant, which will cover a significant number of events companies that have premises. Obviously, if they do not have premises, they will not qualify for business rates relief, but should be eligible for some of the other measures that I have outlined today.

[Official Report, 17 March 2020, Vol. 673, c. 964.]

Letter of correction from the Chancellor of the Exchequer, the right hon. Member for Richmond (Yorks) (Rishi Sunak):

An error has been identified in the answer I gave to my hon. Friend the Member for Buckingham (Greg Smith).

The correct answer should have been:

[Rishi Sunak]

Those that occupy certain business properties, as described in forthcoming guidance, will be eligible both for the relief and the grant, which will cover a significant number of events companies that have premises. Obviously, if they do not have premises, they will not qualify for business rates relief, but should be eligible for some of the other measures that I have outlined today.

The Economy

Rishi Sunak Excerpts

Thursday 24th September 2020 Commons Chamber

[The Chancellor of the Exchequer (Rishi Sunak)]

Thank you for granting me permission to make this statement to the House, Mr Speaker. Earlier this week, the Prime Minister set out the next stage of the Government’s health response to coronavirus. Today, I want to explain the next phase of our planned economic response. The House will be reassured to know that I have been developing plans to protect jobs and the economy over the winter period—plans that seek to strike a finely judged balance between managing the virus and protecting the jobs and livelihoods of millions.

I know that people are anxious, afraid and exhausted at the prospect of further restrictions on our economic and social freedoms. I share those feelings, but there are reasons to be cautiously optimistic. We are in a fundamentally different position than we were in March, and we now know much more about this virus. Public awareness of the risks and how to mitigate them is far greater, and we have met our promise to give the NHS whatever it needs, with significant new funding for NHS capacity and for personal protective equipment. I can inform the House that we have now provided over £12 billion for test and trace.

In economic terms, while our output remains well below what it was in February, we have seen three consecutive months of growth, and millions of people have moved off the furlough and back to work. But the resurgence of the virus and the measures we need to take in response pose a threat to this fragile economic recovery, so our task now is to move to the next stage of our economic plan, nurturing the recovery by protecting jobs through the difficult winter months.

The underlying rationale for the next phase of economic support must be different from what came before. The primary goal of our economic policy remains unchanged—to support people’s jobs—but the way we achieve that must evolve. Back in March, we hoped we were facing a temporary period of disruption. In response, we provided one of the most generous and comprehensive economic plans anywhere in the world, with £190 billion of support for people, businesses and public services as we have protected our economic capacity. It is now clear, as the Prime Minister and our scientific advisers have said, that for at least the next six months the virus and restrictions are going to be a fact of our lives. Our economy is now likely to undergo a more permanent adjustment. The sources of our economic growth and the kinds of jobs we create will adapt and evolve to the new normal, and our plan needs to adapt and evolve in response.

Above all, we need to face up to the trade-offs and hard choices that coronavirus presents, and there has been no harder choice than the decision to end the furlough scheme. The furlough was the right policy at the time we introduced it. It provided immediate short-term protection for millions of jobs through a period of acute crisis, but as the economy reopens, it is fundamentally wrong to hold people in jobs that only exist inside the furlough. We need to create new opportunities and allow the economy to move forward, and that means supporting people to be in viable jobs that provide genuine security.

As I have said throughout this crisis, I cannot save every business. I cannot save every job. No Chancellor could. But what we can and must do is deal with the real problems businesses and employees are facing now. In March, the problem was that we ordered businesses to close. In response, we paid people to stay at home and not work. Today, the problem is different. Many businesses are operating safely and viably, but they now face uncertainty and reduced demand over the winter months. What those businesses need is support to bring people back to work and protect as many viable jobs as we can.

To do that, I am announcing today the new jobs support scheme. The Government will directly support the wages of people in work, giving businesses that face depressed demand the option of keeping employees in a job on shorter hours, rather than making them redundant.

The job support scheme is built on three principles. First, it will support viable jobs. To make sure of that, employees must work at least a third of their normal hours and be paid for that work as normal by their employer. The Government, together with employers, will then increase those people’s wages, covering two thirds of the pay they have lost by reducing their working hours. The employee will keep their job.

Secondly, we will target support at firms that need it most. All small and medium-sized businesses are eligible, but larger businesses only when their turnover has fallen through the crisis.

Thirdly, it will be open to employers across the United Kingdom, even if they have not previously used the furlough scheme.

The scheme will run for six months, starting in November. Employers retaining furloughed staff on shorter hours can claim both the job support scheme and the jobs retention bonus.

Throughout this crisis, we have sought parity between employees and the self-employed, providing more than £13 billion of support to over 2.6 million self-employed small businesses, so I am extending the existing self-employed grant on similar terms and conditions as the new jobs support scheme.

These are radical interventions in the UK labour market—policies we have never tried in this country before. Together with their jobs retention bonus, the kickstart scheme for young people, tens of billions of pounds of job creation schemes and new investment in training and apprenticeships, we are protecting millions of jobs and businesses.

If we want to protect jobs this winter, the second major challenge is helping businesses with cash flow. Over the past six months, we have supported business with tens of billions of pounds of tax deferrals and generous Government-backed loans. Those policies have been a lifeline, but right now businesses need every extra pound to protect jobs, rather than repaying loans and tax deferrals, so I am taking four further steps today to make that happen.

First, bounce back loans have given over a million small businesses a £38 billion boost to survive this pandemic. To give those businesses more time and greater flexibility to repay their loans, we are introducing pay as you grow. This means loans can now be extended from six to 10 years, nearly halving the average monthly repayment. Businesses that are struggling can now choose to make interest-only payments, and anyone in real trouble can apply to suspend repayments altogether for up to six months. No business taking up pay as you grow will see its credit rating affected as a result.

Secondly, I am also changing the terms of our other loan schemes. More than 60,000 small and medium-sized businesses have taken out coronavirus business interruption loans. To help them, I plan to extend the Government guarantee on those loans for up to 10 years, making it easier for lenders to give more people more time to repay. I am also extending the deadline for all our loan schemes to the end of this year, and we are starting work on a new successor loan guarantee programme that is set to begin in January.

Thirdly, I want to give businesses more time and flexibility over their deferred tax bills. Nearly half a million businesses deferred more than £30 billion of VAT this year. Under current plans, those payments fall due in March. Instead, I will allow businesses to spread that VAT bill over 11 smaller repayments, with no interest to pay. Any of the millions of self-assessed income tax payers who need extra help can also now extend their outstanding tax bill over 12 months from next January.

The final step I am taking today will support two of the most affected sectors: hospitality and tourism. Under current plans, their VAT rates will increase from 5% to the standard rate of 20% on 13 January. To support more than 150,000 businesses and help to protect 2.4 million jobs through the winter, today I announce that we are cancelling the planned increase, and will keep the lower 5% VAT rate until 31 March next year.

Today’s measures mark an important evolution in our approach. Our lives can no longer be put on hold. Since May we have taken steps to liberate our economy and society. We did those things because life means more than simply existing. We find meaning and hope through our friends and family, and through our work and community. People were not wrong for wanting that meaning, and for striving towards normality, and neither were the Government wrong to want that for them. I said in the summer that we must endure, and live with the uncertainty of the moment, and that means learning our new limits as we go. The truth is that responsibility for defeating coronavirus cannot be held by the Government alone. It is a collective responsibility, shared by all, because the cost is paid by all.

We have so often spoken about the virus in terms of lives lost, but the price our country is paying is wider than that. The Government have done much to mitigate the effects of those awful trade-offs between health, education, and employment, and as we think about the next few weeks and months, we must bear all those costs in mind. As such, it would be dishonest to say that there is now a risk-free solution, or that we can mandate behaviour to such an extent that we lose any sense of personal responsibility. What was true at the beginning of this crisis remains true now: it is on all of us, and we must learn to live with it, and live without fear. I commend this statement to the House.

[Mr Speaker]

I recognise the importance of this statement and that, quite rightly, the shadow Chancellor might need a little more time. I will ensure that the other Front-Bench speakers also have some extra time.

[Anneliese Dodds (Oxford East) (Lab/Co-op)]

I thank the Chancellor for his statement and for advance sight of this announcement. I have called for the introduction of a system of targeted wage support 40 times. That call has been rebuffed by the Government 20 times. It is a relief that the Government have U-turned now, but we must be open and honest: that delay in introducing this new scheme will have impacted on businesses’ confidence. I know that from talking to them, and I am sure that Government Members know that from talking to businesses in their constituencies.

The deadline for redundancy consultations by large firms before the end of the furlough scheme came and went last week without a word from the Government. If the package of measures announced today can help people keep their jobs and help businesses through hard times, Labour will of course support it. There is much in the statement that we do support—as I just said, we have repeatedly called for a system of targeted wage support, and we have called for help for indebted, cash-strapped businesses over and over again—but we must ensure that these measures are as effective as possible at keeping workers in employment, getting unemployed people back into work and keeping viable businesses in operation.

As with many previous announcements by the Government, we must wait for the detail to be revealed—presumably following the press conference scheduled for later on today. Workers and businesses are hanging on the Chancellor’s every word right now, and they need to know what is promised here. So can the Chancellor be clear: will the wage support scheme actually keep more people in work? For that to happen, the scheme must make it more attractive for employers to retain more staff on reduced hours than to retain some full time and make others redundant. Does his scheme actually incentivise short-hours working?

What conditions, if any, will be applied to ensure value for public money? Will the scheme require commitments to continuing employment, unlike the existing furlough scheme, where there have been abuses? Will it require those participating to provide decent, sustainable work?

Will the scheme incentivise training and retraining? The German scheme does, and Labour has called for a UK version to include incentives for training, but that is missing here. Indeed, while, as I said, we welcome many of the elements that the Chancellor has announced, the lack of action on training and skills is worrying. I was waiting and waiting for the Chancellor to talk about training. He mentioned the word once, in passing. That is not enough. His Government have already allocated funding for a national skills strategy, but it is not being delivered on the ground. When will the Chancellor get serious about training so that people can be ready for the jobs of the future? He mentioned the fact that our economy is changing. Let us make sure that our population is ready for that change.

Labour has called repeatedly for continued, targeted support for the self-employed, so I am pleased that that is referred to here, but will these measures avoid the gaps in coverage that have bedevilled existing schemes? Why is there no forward plan for the needs of those who are extremely clinically vulnerable to the disease? Belatedly, will the Chancellor do more to demand that his colleagues get a grip on the UK’s public health crisis? Our country is suffering from a double tragedy: the highest excess death rate in Europe and the deepest recession in the G7.

Labour supports the Government in their announcement of additional restrictions this week. The Government’s messaging has been confused enough already, so the last thing we want to do is add to that confusion, but we are concerned that these restrictions are necessary only because of continuing problems with test, trace and isolate. The Chancellor referred to the money put into test, trace and isolate. As I said earlier this week, enormous sums have been devoted to that task, but those sums are not delivering the system that we need. We are still not at the stage of many other countries. The Chancellor must work on that, as well as his other colleagues in Government.

Finally, before the summer recess, Labour called for a back to work Budget focused on jobs, jobs, jobs. We did not get one. We expected a Budget this autumn. It appears, again, that we are not getting one. That is despite the challenges it poses for devolved Governments, and despite the fact that the Government have actually referred to provisions in a future Finance Bill as necessary for their approach to Brexit. The Chancellor announced that he would make a statement to Parliament today only after I had called for him to come here to answer an urgent question; I am very grateful to you, Mr Speaker, for granting that.

This Government have lagged behind on test, trace and isolate. They have lagged behind on wage support. They have lagged behind on support for those having to self-isolate. They are lagging behind on green investment. For these and for other reasons, it looks like our recovery will be lagging behind that of many other countries. So, finally, when will the Chancellor provide the back to work Budget that this country needs?

[Rishi Sunak]

I thank the hon. Lady for her comments. On the question of continued support for jobs, however, I had hoped that she would have welcomed strongly today’s measures, if for no other reason than that she has previously asked for something similar. However, her position on this matter has been somewhat changeable. At different points in the last few weeks and months, she has said that furlough should not go on for ever, and then changed her mind and said that we should extend it. Then she changed her mind and said it should be replaced, and then only yesterday the Leader of the Opposition said it should be extended again. That is not the kind of certainty that British businesses or British workers need.

To address the specific questions, this scheme absolutely does incentivise shorter time working. The company will pay its workers for the time that they are in work, and the Government and the employer jointly will subsidise the time the worker is not working. The conditions will be set out in guidance, which will be published shortly, and then over the next few weeks the further details will be worked through with businesses and unions, as we did with the furlough scheme.

I can reassure the hon. Lady that the new scheme does indeed have the conditionality that is appropriate for this stage of our response. Notably, this scheme will be available only for larger companies that are seeing a decline in their revenues as a result of coronavirus, ensuring that our support is targeted where it is most needed. Similarly, there will be restrictions on larger companies in capital distributions to shareholders while they are in receipt of money for their workers under this scheme. Indeed, they will not be able to give redundancy notices to those workers who are on this scheme throughout its duration.

We have increased training both for post-16 at the Budget and, indeed, in the recent plan for jobs, providing increased access for school leavers to level 2 qualifications across the board. Notably, one of the hallmarks of our skills system is our successful apprenticeship programme. What we announced in July was a significant increase in the incentive payment to businesses for taking on a new apprentice: a £2,000 cash incentive to businesses to take on an apprentice and provide that valuable in-work training that we know makes such a difference to young people’s futures. So we are committed to providing especially our young people with the opportunities that they need to succeed in the future.

The hon. Lady talked about jobs. In July, we outlined a £30 billion plan for jobs—to support, create and protect jobs across every part of our United Kingdom. Chief among the initiatives was the kickstart scheme, where right now employers—small, medium-sized and large—are rushing to put in applications to take on a young kickstarter later this autumn, to provide them with the opportunities that they need at an incredibly difficult time. I can assure this House and the country that my No. 1 economic priority is to protect people’s jobs, and that is what this Government will continue to do.

In conclusion, the Opposition wanted the furlough extended, but they never said for how long. Then they wanted the furlough replaced, but they would not say what with. Then they wanted the furlough targeted, but they would not say on whom. I do stand ready to work with the hon. Lady, if she knew exactly what she wanted. Today, the Government stand with the British people and British business, with the CBI, the British Chambers of Commerce and the Trades Union Congress, in bringing much-needed support to the economy. Yesterday, the Leader of the Opposition called for a plan B for the economy. The Labour party does not even have a plan A.

[Mel Stride (Central Devon) (Con)]

The devil, of course, will be in the detail, but from what I have heard, I broadly and warmly welcome this statement. I am encouraged by the job support scheme and the fact that it is targeted, for which I and my Committee have been calling for some time. I am encouraged by the announcements on loans and the pay-as-you-grow scheme, particularly to help small and medium-sized enterprises, and I am encouraged that the self-employed will have their scheme extended.

However, my right hon. Friend will know that there was considerable concern that many self-employed people fell through the gaps of the support provided. Will he say something about whether some of those gaps will be ameliorated or ironed out as a consequence of the new measures, and will he meet me in fairly short order to discuss the options that might be available?

[Rishi Sunak]

I thank my right hon. Friend for his comments; I am sure he will see in much of what we have announced today some of the thinking in his latest report. I thank him and his Committee members for all the input they have provided in helping us to think about the next phase of our economic response. He is right that this package focuses on employment and, indeed, on supporting businesses with their cash flow.

With regard to the self-employed, I am glad my right hon. Friend welcomes the extension of the existing support grant. Virtually no other country in the world has done that, and it comes on top of the most generous support for our self-employed of almost any country throughout the response to this crisis. Of course, I will be happy to meet him, but I know he will also be pleased to learn that the measures today to defer income tax self-assessment will be of particular importance to our self-employed small businesses.

[Alison Thewliss (Glasgow Central) (SNP)]

Scottish National party Members are glad that the Chancellor has accepted the need to extend support, but it comes very late in the day and is little comfort to those who have already lost their jobs due to the impending end of the furlough scheme. Industry, trade unions, the Treasury Committee, people across the country and hon. Members across parties in this House have been pleading with him for months now, and it feels as if it is only the latest spike that has prompted his action.

Coronavirus is not done with us yet. The furlough scheme has saved jobs and kept people paying their bills and mortgages. It has been incredibly important and it is a shame that the Chancellor is ending it at the end of next month. Hospitality, travel and tourism, aviation exhibitions, culture and performing arts, even travelling showpeople, and a host of others cannot go back to normal work because the Government have placed restrictions on their businesses.

Those jobs and those businesses are viable—it is not for the Chancellor to decide the viability of businesses. Ending the scheme put 61,000 Scottish jobs at risk. His measures on the pay-as-you-grow scheme recognise that many businesses have deferred payments and have mounting debt. However, the problem for many businesses is not income deferred, but income lost completely, so will he go further and convert those loans to grants and equity, to give companies a bit more certainty about their future? We welcome the hospitality and tourism VAT cut, but will he reassess that in March and perhaps consider keeping it in place permanently to help those businesses pick up, hopefully, through an improved situation next summer?

There is nothing here, nothing whatsoever, for those who have been excluded from existing support schemes—for freelancers, the Forgotten Ltd, the pay-as-you-earn employees, the new starters, the women on maternity and all those who have had not one penny piece from this Government for six months. The Chancellor cannot say he does not know that that is a problem, although he still refuses to meet them. How dare he say that these 3 million people should be left high and dry with nothing?

Will the Chancellor introduce further conditions to prevent unscrupulous employers from exploiting the new schemes as BAE and others have done? Will he support the fire and rehire Bill from my hon. Friend and colleague the Member for Paisley and Renfrewshire North (Gavin Newlands), which would prevent that exploitation in future?

The Chancellor did not have the courtesy to lift the phone to the Cabinet Secretary for Finance in the Scottish Government, Kate Forbes, or her counterparts in Wales and Northern Ireland, to let her know that he plans to scrap the autumn Budget. They found out on Twitter. It is not the first time this Government have had a lack of respect for the devolved institutions, because that happened last year, too. Does he appreciate the very difficult situation he has created? With no access to the fiscal levers and no clarity on the funding settlement, he has tied both of Kate Forbes’s hands behind her back. What does he intend to do about that?

[Rishi Sunak]

I think the hon. Lady is continuing to ask for an extension of the furlough scheme, but fundamentally I do not believe that that would be the right thing to do. At this stage of the economic recovery it is better that our support is targeted and focused on supporting viable jobs in our economy, and that means a new approach. Extending the furlough and allowing people to be at home full time is not the right approach in this phase of the economic crisis. Our new scheme will ensure that we provide support to those who need it most and protect as many viable jobs as possible in many of the industries she mentioned.

The hon. Lady asked about conditions. I agree with her that there should be conditions on larger companies accessing support from the Government for wage protection. There will be conditions on capital redistributions and on the ability to provide redundancy notices to employees while they are on the scheme, and, in the first place, limiting the eligibility for large companies to those that are most in need.

On dialogue with the Scottish Government, I am pleased to say that the Chief Secretary to the Treasury speaks regularly with his counterparts, as I believe he will be doing very shortly. There is a well worked process for how devolved nations’ budgets are set. There is absolutely no requirement for a UK Budget to be done beforehand. Indeed, that was not the case earlier this spring. We will have Office for Budget Responsibility forecasts later this autumn. On the basis of those forecasts, the normal work will be done with our counterparts in the devolved authorities to ensure that they can set the budgets they need.

[Douglas Ross (Moray) (Con)]

Over 900,000 Scottish jobs have been protected as a result of the UK Government’s furlough scheme during the worst of this crisis, ensuring that over the past six months hundreds of thousands of Scottish families have continued to maintain a regular income. I welcome the further support announced by the UK Government today. Will the Chancellor of the Exchequer outline how the UK Government measures will benefit communities, businesses, individuals and families across Scotland as we enter this next difficult phase in our fight against coronavirus?

[Rishi Sunak]

I am grateful to my hon. Friend for his question and for the conversations he has had with both me and the Prime Minister on the importance of supporting every part of our United Kingdom as we go through this economic crisis and drive our recovery forward. That is something this Government will always take very seriously. He has been very helpful and played a valuable role in ensuring that the measures we have put in place today will benefit companies and workers in every single part of our United Kingdom.

[Charlotte Nichols (Warrington North) (Lab)]

Large parts of the north, including my constituency, are under extra restrictions but are not being given additional support from the Treasury, whether it is our local authorities or our businesses. If the Government’s levelling up agenda is to mean anything, that must be urgently addressed. Today’s statement is a significant change of direction from “whatever it takes”, so what extra measures will the Chancellor provide to constituencies such as mine to ensure we are not levelled down as a result of the pandemic?

[Rishi Sunak]

There is support in place for local authorities, through the NHS, for any response in areas of tightened restrictions, whether for community information or enhanced testing. Recently, we outlined a self-isolation incentive payment of up to £500 and a business grant support scheme for businesses that have been ordered to close. The Government remain committed to levelling up in every part of our country, as outlined in our ambitious plans to invest in infrastructure in every part of our country.

[Lee Anderson (Ashfield) (Con)]

The eat out to help out scheme was a massive success in Ashfield, with 53,000 meals served. The scheme saved thousands of jobs and kept hundreds of businesses open. However, my wife is not happy with the Chancellor, because I put a stone on in weight in August, which meant I needed bigger clothes. Jono Edwards, who owns the world-famous Junction Bar & Restaurant, is very happy with the Chancellor. Jono tells me that without the Chancellor’s support his bar would have closed and his staff, who are like a family to him, would have lost their jobs. May I pass on my thanks to the Chancellor from every single pub and hospitality business in Ashfield for extending the 5% VAT cut until next March? Jono Edwards, Dame Margo and Donna at the Junction pub will be very happy with this great news.

[Rishi Sunak]

I thank my hon. Friend, and I am glad that our initiatives have made such a difference on the ground to people in his constituency in protecting jobs, as I am sure they have elsewhere. I very much hope that I can come to visit him and Jono and his team at the Junction pub in the near future, and I wish them every support through the next few months. I hope that the measures we have put in place today will ensure that they continue to thrive in the future.

[Rachel Hopkins (Luton South) (Lab)]

I have called for targeted support for jobs in the aviation sector a number of times. The sector would be viable if not for the impact of coronavirus, but in my constituency easyJet, Tui and Luton Airport have already been forced into making redundancies due to the lack of Government support. Can the Chancellor explain why the Government waited until a week after the deadline passed for consultation on large redundancies caused by the end of the coronavirus job retention scheme to announce its replacement?

[Rishi Sunak]

Our response will continue to evolve as the circumstances demand. With respect to aviation, I have every sympathy for companies and employees in that sector; obviously, they have been very hard hit. The measures that we have put in place have made a significant difference to businesses in that sector. Indeed, I think that one of the ones the hon. Lady mentioned is among the many that have accessed some of our much larger loan schemes to provide vital liquidity at a very difficult time, and I know that many businesses in the aerospace supply chain will particularly welcome the part-time working job support scheme we have announced today, as it will be particularly well suited to their manufacturing businesses.

[Peter Aldous (Waveney) (Con)]

I welcome the Chancellor’s statement. His stamp duty holiday, which is due to expire on 31 March, has been extremely successful in stimulating an important part of the UK economy. What plans does he have for further housing initiatives, which will not only generate business activity but, if properly focused, also alleviate poverty and promote social mobility?

[Rishi Sunak]

My hon. Friend is absolutely right to say that the stamp duty cut is driving activity in the housing market, which is helping to protect jobs in that sector. I would point him to our green homes grant, which the Department for Business, Energy and Industrial Strategy is going to roll out shortly and which will provide households with a grant of up to £5,000 to subsidise initiatives to improve the insulation and energy efficiency of their homes. There will be larger grants available for those households most in need, as determined by their local authorities, helping them not only to save on carbon emissions but to save up to £300 a year on their energy bills.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

We talk about a green industrial revolution and the Chancellor talks about job protection, yet just last week, Scottish yards missed out on the procurement contracts for the Seagreen offshore wind project. In terms of real job creation, will he consider the Scottish Government’s plea for an £80 billion UK stimulus? Will he also confirm when the national infrastructure strategy and the energy White Paper will be published and, crucially, will he instruct officials to look at how the contracts for difference process works and change it so that it incentivises the use of UK supply chains?

[Rishi Sunak]

The hon. Gentleman is absolutely right about the importance of offshore wind to our economy. It is something that we have a global strategic competitive advantage in, and this Government will continue to support the sector in the way that we have. I am always open to new ideas about how to do that, but we must ensure that we double down on our advantage and drive jobs in every part of our country, not just in Scotland but in the north-east, where we have considerable advantages over other countries, not just in providing energy but now in manufacturing more of the content that goes into our turbines.

[Jacob Young (Redcar) (Con)]

I thank my right hon. Friend for his statement. Does he agree that, as the coronavirus is now threatening our recovery, it is right that we focus our support on the problems that businesses in Redcar and Cleveland and elsewhere are facing right now? Support for viable businesses and viable jobs through a time of depressed demand due to the restrictions that virus threatens is exactly what the new job support scheme delivers.

[Rishi Sunak]

My hon. Friend is absolutely right. He knows all too well what the businesses in his constituency need, which is support to get through this period of depressed demand. They need our support to protect those viable jobs and to help them get through to the other side, and that is exactly what the job support scheme will deliver.

[Stephen Farry (North Down) (Alliance)]

It is right that the economic support schemes evolve, and this will be a lifeline for many people in Northern Ireland. The Prime Minister has talked about embracing everyone and the need for creativity and innovation, but surely there are two gaps in today’s announcements: first, the excluded; and secondly, the companies where even paying a third of the wages is not a viable option at this time even though they do have sustainable futures, such as in the arts and creative industries and aerospace.

[Rishi Sunak]

In terms of the arts and creative industries, we have provided over £1.5 billion of funding to support vital institutions in every part of the United Kingdom through that scheme, but it is important now that support is focused on companies that can provide viable jobs, with a genuinely secure future for their employees. As we have set the scheme, it is very similar to those around the world and gets that balance right, being generous with our support but also making sure that support is targeted where it can do the most good.

[Joy Morrissey (Beaconsfield) (Con)]

I thank my right hon. Friend for listening to Members’ concerns about small businesses and the self-employed and for taking the time to engage with us and hear our concerns. In Beaconsfield, we have 4,000 people who have already benefited from the Government’s self-employed income support scheme, protecting their livelihoods. I therefore welcome today’s announcement that we will continue the support for the self-employed, through a further extension in the grant, and continue our unprecedented support for both the employed and self-employed. May I invite him to Marlow to see all the good work that he has done through his schemes?

[Rishi Sunak]

I am very happy to take up my hon. Friend’s invitation. She is right to highlight the very comprehensive support that we have put in place for the self-employed. Compared with almost any other country anywhere in the world, it is more comprehensive, generous and has lasted for far longer than one can find elsewhere.

[Christine Jardine (Edinburgh West) (LD) [V]]

[Inaudible.]

--- Later in debate ---

[Rishi Sunak]

I welcome my right hon. Friend’s comments. He knows better than most what a difference our welfare system and, indeed, the Department for Work and Pensions and its phenomenal staff can make on the ground. I know that he will join me in welcoming not only the increase, temporarily, that we have put on universal credit for this year, providing almost £1,000 extra to those who are in receipt of it, but our further increases in and generosity with the local housing allowance and the provision of hardship funds to those struggling to pay their council tax bills, distributed through local authorities. In some areas, that represents a significant amount of support for the most vulnerable in our society—a point that was borne out in the distribution analysis that we published this summer, which showed that the most vulnerable in our society had benefited the most from our support.

[Stephen Timms (East Ham) (Lab)]

On universal credit, the Chancellor rightly, at the start of the pandemic, suspended the minimum income floor in universal credit to avoid an unnecessary barrier to new self-employment. Given his welcome announcements today, will he extend the duration of that suspension beyond the middle of November, when it is currently due to end?

[Rishi Sunak]

Decisions on the exact operation of our welfare system are for the Secretary of State for Work and Pensions, but I will happily reflect on the point that the right hon. Gentleman makes. He is right that that has made a significant difference in the early stage of this crisis, but as we go through it, we will make sure that we adjust and tailor our support to match the needs of the moment.

[Madam Deputy Speaker]

Let us see whether we can go back to Christine Jardine.

[Christine Jardine [V]]

I hope that you can hear me this time, Madam Deputy Speaker. 

I thank the Chancellor for early sight of his statement, which I cautiously welcome, to the extent that he has listened to calls from Liberal Democrats to extend furlough and create some flexibility based on the German Kurzarbeit model, but what about the 3 million people who have had no support for six months and will still be excluded from financial help? Where are the job creation plans to tackle unemployment and for those who cannot work for a third of the time? Where are the incentives for manufacturing and industry to invest in this country and create new jobs—the green revolution—allowing us to compete with our European neighbours, who are already moving ahead of us?

[Rishi Sunak]

In terms of ensuring that we are winners in the green industrial revolution, I point the hon. Lady to measures that we already announced in the Budget to provide significant support for initiatives such as carbon capture and storage and the construction of a charging infrastructure fund, to build more charging points across the United Kingdom. Such measures will make an enormous difference, on top of our commitment to double our research and development spending over the next few years, ensuring that businesses across the UK can play a leading role in driving our progress towards meeting our climate targets and creating new jobs in the process.

[Nickie Aiken (Cities of London and Westminster) (Con)]

I warmly welcome the Chancellor’s statement, particularly the extension of the 5% VAT rate to next March. I know that many of the hospitality businesses in my constituency will welcome that as they grapple with the loss of tourists and office workers. Many are reporting that trading is at 20% of normal levels. Will he agree to meet me and representatives of theatres and the hospitality and retail sectors to discuss what further measures we can take to support the west end’s recovery?

[Rishi Sunak]

My hon. Friend is right. I know that she has spent a lot of time focused on this issue, and businesses in her constituency are facing an especially hard time. I would be delighted to meet her and them to see what more we can do to support them.

[Chris Bryant (Rhondda) (Lab)]

I used to be a curate, so I recognise a curate’s egg when I see one. This is good, but only in parts. The truth is that lots of people’s jobs are only unviable because of the virus and Government restrictions—I am not attacking the Government for that, but that is the simple truth. We therefore have a moral duty to try to help those people to survive, with proper livelihoods into the future. That especially applies to the aviation industry and the hospitality industry in my patch. I hope that the Chancellor will be able to say something more about specific grants, not just loans, for businesses that are sorely affected.

The Chancellor still has not answered the question about the 3 million people who got nothing earlier this year. Perhaps there was something hidden in what he said about the self-employed that means more people will get support this time, but he must have had constituents contact him, as I have. Finally, I wrote to him on 23 February—214 days ago—about the massive flooding in south Wales. He has not yet replied. A tip has fallen into the river. Can he visit the Rhondda and see the problems that we have? We really need financial support. The Prime Minister has promised that an answer is coming quickly, but we have still not had it—or the Chancellor could just send a cheque.

[Rishi Sunak]

I apologise to the hon. Gentleman; I will find his correspondence as soon as I can and get him the reply that he deserves. I do not think I disagree with him. It is right that we focus our support on viable jobs. Those jobs are, in part, not viable because of the restrictions. The balance that we have to get right is in understanding that we will be dealing with this virus for a while to come—it is not here and then gone. That changes what our support should do. We have to focus it on those with a genuine prospect of employment, and I think the job support scheme gets that balance right. It is generous and flexible. With regard to hospitality, which is important to his constituency, I know that the industry will warmly welcome the extension of the VAT cut into the spring.

[Lucy Allan (Telford) (Con)]

The Chancellor has shown himself to be nimble and agile throughout this crisis. I congratulate him on his statement and his recognition that we must adapt and evolve and can no longer put our lives on hold. I particularly welcome the measures to support hospitality and the 5% VAT rate extension. The fantastic Telford International Centre for businesses and conferences brings in 300,000 people every year, but its turnover is now zero. Will he continue to do all he can to support the events industry, which is so important to my town?

[Rishi Sunak]

I thank my hon. Friend for her comments, and she is right: the Government must respond with agility as the virus and our economy evolve over the coming weeks and months, and we will continue to do that. I very much sympathise with her and those in the events industry, given the difficulties they are experiencing. I know that conversations are ongoing with the Business Secretary about what can be done to best ensure that, at some point in the future, we can return to what we all want, which is the thriving industry her constituency wants to see.

[Ben Lake (Ceredigion) (PC)]

The Chancellor mentioned that the existing self-employed support grant will be extended on similar terms and conditions to the new jobs support scheme, but can he tell the self-employed in rural areas such as Ceredigion, who represent almost 30% of the workforce, whether he has changed the terms and conditions in such a way as to ensure that those who have been excluded from support so far will now get the help they deserve?

[Rishi Sunak]

The eligibility conditions will remain as they are, with refinements to make sure that businesses are still trading over the winter and to recognise that they have suffered and are suffering an impact on revenues through coronavirus. The reasons for those eligibility criteria are well documented and have been discussed in this House many times, so I will not recap exactly why they are there, but it is worth bearing in mind that the extension of this support means that we have provided more support to 2.5 million self-employed people, which is considerably more than any other country has and for a longer duration.

[Andrew Jones (Harrogate and Knaresborough) (Con)]

I welcome the significant and wide-ranging package that my right hon. Friend has introduced, and I want to focus on one element of it, cash flow, which is always a critical issue for businesses. Bounce back loans have been used by over 1 million companies across the UK, including 1,794 in Harrogate and Knaresborough, which have taken out loans worth more than £51 million. I therefore welcome the new pay as you grow scheme, which means that businesses will now enjoy greater flexibility to repay their loans over a longer period. Does my right hon. Friend agree that that will be of great value to businesses and that extending the terms to 10 years will halve the average monthly repayments?

[Rishi Sunak]

My hon. Friend knows from his own business career the importance of cash flow, and he is absolutely right. He mentioned the almost 2,000 businesses in his constituency; on average, they probably took a bounce back loan of about £30,000. This extension to 10 years will reduce the average monthly repayment from something over £500 to just around £300, which will provide thousands of pounds of cash-flow relief to his 1,800 businesses, but also to 1 million others around the United Kingdom.

[Gerald Jones (Merthyr Tydfil and Rhymney) (Lab)]

As we have heard, around 3 million people across the country were excluded from support during the first stage of the pandemic. Yesterday I was contacted by a wedding photographer in my constituency who is struggling to pay his mortgage and feed his family, and the prospect of many more months of uncertainty is terrifying for him and many others in similar industries and sectors, such as event planning, that are unable to operate in anything like normality at the moment. What assurances can the Chancellor offer that the measures he has announced today will not continue to exclude people such as my constituent and many more across the country?

[Rishi Sunak]

The hon. Gentleman mentioned mortgages, and I am sure his constituent, like many others, will have benefited from the mortgage holidays that we put in place, which my hon. Friend the Economic Secretary helped to organise with the banking system. Those provided six months of mortgage holidays for people, and, indeed, one in six mortgages across the UK was able to benefit from that generous scheme.

[Dame Cheryl Gillan (Chesham and Amersham) (Con) [V]]

May I also congratulate the Chancellor on today’s groundbreaking announcements and particularly on focusing support on viable jobs and ensuring that support goes where it is most needed? The extended guarantee on CBILS, as well as pay as you grow and the measures on VAT, will be warmly welcomed by individuals and businesses in Chesham and Amersham. However, does my right hon. Friend remember the Micawber principle:

“Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."

What can he say to my constituents who ask how we are going to pay this enormous bill, and how can he ensure that we provide value for money for the taxpayer?

[Rishi Sunak]

My right hon. Friend is absolutely right and I am grateful to her for her instruction on the fiscal maths that we are grappling with! As we move our way through this crisis, the nature of our response has to change. It is simply not sustainable or affordable to continue to provide the level of support that we gave at the beginning of this crisis. That is why our support is now targeted and focused on where it can make the most difference. That will mean that we cannot do absolutely everything that everybody needs at once, but we will be able to focus it on where it can make the most difference, so that, as quickly as possible, we can get our economy growing again and ensure that the maths my right hon. Friend outlined starts to work in our favour. We cannot borrow at this level forever. We must get our borrowing back under control and eventually get our debt falling again.

[Janet Daby (Lewisham East) (Lab) [V]]

I welcome the Chancellor’s statement. Almost 700,000 people lost their jobs between March and July. What is the Government doing to support these people, because the use of food banks has in some cases tripled? What will the Government do to support those who will lose their jobs in the months to come, to help them during any period of unemployment, and to get them back into work as quickly as possible?

--- Later in debate ---

[Rishi Sunak]

The hon. Lady is absolutely right: it is a tragedy that 700,000 people have already lost their jobs and many more will. Our focus should be, and is, on finding fresh, new opportunities to provide them with the security that they and their families so desperately need. That is why we have provided incentives for companies to take on new staff through our apprenticeship scheme. We have also provided incredibly intensive support through the Department for Work and Pensions, through a doubling of the number of work coaches and greater wraparound support to help all of those people mentioned to plot their course and chart a better future for themselves.

[Nicola Richards (West Bromwich East) (Con)]

The new jobs support scheme rightly focuses on protecting employment and preserving viable jobs during a period of depressed demand. Businesses and workers in West Bromwich East will be extremely grateful for that. Does the Chancellor agree that it is also fair that the scheme targets those businesses that need it most, and will he set out how the scheme is deliberately targeted in that way? Will he also join me in visiting the incredible Red Lion Desi pub, to hear how it has benefited from the eat out to help out scheme?

[Rishi Sunak]

My hon. Friend is absolutely right about the nature of our support at this phase in our recovery. In a couple of different ways, this support has evolved in the way she said. It is targeted at those larger businesses that really need it, whose revenue has declined, and it is targeted specifically at protecting and supporting viable jobs—those jobs where there is work to do but the company is facing a period of repressed demand. This is a scheme that will make an enormous difference to those people, but in a targeted and effective way.

[Neil Gray (Airdrie and Shotts) (SNP) [V]]

From talking in July about “nobody left behind”, to accepting today that so-called “unviable jobs” will be lost, the Chancellor has failed to live up to his own rhetoric. The viability of these jobs is in large part dependent on entirely necessary Government restrictions, and it is disappointing that he continues to abandon the 3 million excluded from support. Given that he now accepts further widespread job losses, why has he not made permanent the temporary £20 per week universal credit uplift and expanded it to legacy benefits?

[Rishi Sunak]

The temporary increase in universal credit already lasts all the way through to the end of March next year. For those who are most vulnerable, as I have said previously, we have provided significant enhanced support through the welfare system, including almost £1 billion of extra investment in local housing allowance, to help with private rent payments, and a hardship fund, to help people who are struggling to pay their council tax bills. As our analysis showed in the summer, the interventions that this Conservative Government have made over the past several months have made the most difference to those on the lowest incomes.

[Sajid Javid (Bromsgrove) (Con)]

I know what it is like to have to postpone a much anticipated Budget, but I am pleased to see that it has not prevented my right hon. Friend from doing whatever it takes to protect the economy. Since the onset of this crisis, he has shown the decisiveness, resilience and creativity that the country needs right now, and I commend him for it. I know that he values infrastructure investment and knows that it is going to form an important part of our recovery, so may I urge him to publish the national infrastructure strategy, which has been delayed time and again, as soon as he possibly can, so that we can get on with levelling up across our great country?

[Rishi Sunak]

I thank my right hon. Friend, who is a very good friend of mine, for his warm comments. Whatever I have been able to do over the past several months is in no small part thanks to the instruction that he has given me when he was my boss in not one, but two different Department jobs. He is absolutely right about the importance of infrastructure investment, and he was one of the first people to talk passionately about the need to increase significantly the amount of money that the Government invest in the UK’s infrastructure. It was he, as Chancellor, who put in place the infrastructure revolution, and I can commit to him that I will absolutely deliver on that. He is right that we must publish the national infrastructure strategy; we will do so this autumn.

[Madam Deputy Speaker (Dame Rosie Winterton)]

In order to allow the safe exit of hon. Members participating in this item of business and the safe arrival of those participating in the next, I am suspending the House for three minutes.

Oral Answers to Questions

Rishi Sunak Excerpts

Tuesday 15th September 2020 Commons Chamber

[Joanna Cherry (Edinburgh South West) (SNP)]

What fiscal support he is providing to mitigate the economic effects of the covid-19 outbreak.

[The Chancellor of the Exchequer (Rishi Sunak)]

We have provided unprecedented support worth more than £190 billion to protect public health, businesses and jobs, and the Government remain committed to supporting the economy throughout this crisis. In July, we published our plan for jobs, which announced further support for the economy, with initiatives such as eat out to help out, the £2 billion kickstart scheme and the £9 billion job retention bonus, all of which aim to support, create and protect jobs.

[David Linden]

I hear what the Chancellor says, but emergency food parcels for children are up 107% this year and the Trussell Trust now expects to distribute 300,000 more than expected in the fourth quarter. Given that there is a hard Tory Brexit on the horizon and the end to the furlough scheme will certainly push more people into poverty, will the Chancellor do the right thing, adhere to his moral duty and make the £20-a-week increase to universal credit permanent?

[Rishi Sunak]

Throughout this crisis we have endeavoured to make sure that the most vulnerable in our society get the help that they deserve, which is why results published in July showed that our interventions have meant that those on the lowest incomes have received the most support, through the temporary increase to universal credit, the hardship fund delivered through local councils and, indeed, increases to the local housing allowance to help people with their rental payments.

[Joanna Cherry]

The events and conferences industry was the first to be affected by lockdown and will be the last to see demand return. Many freelancers, such as my constituent Karen Colvin, have not benefited from support in the same way as other workers. Does the Chancellor have anything new to offer to people such as her?

[Rishi Sunak]

Many self-employed people have received the second of the self-employment income support grants—almost 3 million people have now received support through that scheme—but the hon. and learned Lady is right that the best way to provide support for people in that industry is slowly and safely to reopen those bits of our economy. My colleague the Secretary of State for Digital, Culture, Media and Sport Secretary of State is engaged with that industry to start piloting the return of business conferences and events. The situation remains under review.

[Mel Stride (Central Devon) (Con) [V]]

My right hon. Friend has done a tremendous amount to support jobs in our country, but does he agree that many thousands, perhaps even hundreds of thousands, of jobs are going to be viable after covid is dealt with but will not make it unless they are provided with further targeted support after the end of October?

[Rishi Sunak]

As ever, I am grateful for the advice from my right hon. Friend. He is right that businesses do need support, which is why many of the interventions that we have put in place—for example, the business rates holidays and, indeed, our support for the economy and jobs through initiatives such as our stamp duty cut to catalyse the housing market—last through to next year. I hope he will be reassured that throughout this crisis I have not hesitated to act in creative and effective ways to support jobs and employment, and I will continue to do so.

[Alison Thewliss (Glasgow Central) (SNP)]

Many employees, self-employed people and freelancers in sectors such as hospitality, aviation, tourism, showpeople and the arts cannot go back to normal because of the public health measures brought in by the Chancellor’s Government, so will he examine the calls by the Treasury Committee to consider a targeted extension of support for those sectors? If not, why?

[Rishi Sunak]

The hon. Lady mentions hospitality and tourism, which is an industry disproportionately represented in Scotland. That is why the Government took steps in the summer to support the industry, with a temporary VAT reduction from 20% to 5% and, indeed, the eat out to help out initiative, both of which were targeted at helping to protect the 2 million jobs and 200,000 businesses engaged in the industry.

[Alison Thewliss]

That is woefully inadequate, as we head into the winter, for many of these industries that have already suffered with a low income. The Chancellor said that he would do “whatever it takes” and that

“if the situation changed”,

he

“would not hesitate to take further action.”

Those excluded from support schemes, the 700,000 made redundant since March and those losing their jobs because of the premature ending of the furlough scheme want to know whether the Chancellor will be true to that commitment or his words are worth nothing.

[Rishi Sunak]

The hon. Lady claims that it was woefully inadequate; the VAT reduction was the single biggest ask from the UK hospitality industry. Not only was that delivered, but it was delivered with an extra initiative, eat out to help out, which proved to provide an enormous fillip to the reopening of that part of the economy. It is also worth bearing in mind that all the businesses engaged in that industry are not paying any business rates at all until March next year.

[Mr Richard Holden (North West Durham) (Con)]

What estimate he has made of the level of financial support that has been provided to employees by businesses under the coronavirus job retention scheme.

--- Later in debate ---

[Tracy Brabin (Batley and Spen) (Lab/Co-op)]

What assessment he has made of the financial effect of the covid-19 outbreak on people who were not eligible for either the coronavirus job retention scheme or the self-employment income support scheme; and if he will make a statement.

[The Chancellor of the Exchequer (Rishi Sunak)]

The Government have put in place a broad set of policies to support businesses and individuals through this crisis. The coronavirus job retention scheme and self-employment income support scheme have supported more than 9 million and 2.7 million jobs and people respectively. As the economy reopens, we must adjust our support to ensure that people continue to get back to work, protecting the UK economy and people’s livelihoods.

[Helen Hayes]

The Institute for Employment Studies is now predicting 450,000 redundancies over the three months to September and a further 200,000 by the end of the year—more than double the levels seen in the 2008-09 recession. Many of those whose jobs are at risk work in the creative industries, performing arts and hospitality, which would be thriving without coronavirus. Why is the Chancellor persisting with a cliff-edge approach, which will inflict the hardship and misery of unemployment on so many people, instead of taking a flexible approach to furlough to save good jobs for the long term?

[Rishi Sunak]

The furlough scheme, as it is currently constructed, is flexible. It was a key demand from business groups and unions, which we responded to. As the economy is slowly reopening over the late summer and autumn, the furlough scheme has adapted to that, allowing businesses to bring back their employees in a flexible fashion, and that is exactly what they are currently doing.

[Alun Cairns]

I congratulate my right hon. Friend on the introduction of the self-employment income support scheme in particular, but does he recognise that it cannot continue indefinitely? Does he also agree that the self-employed are some of the most innovative individuals in our economy, and it is time to release their innovation to kick-start us?

[Rishi Sunak]

My right hon. Friend is absolutely right. Now that we have begun to reopen the economy, it is right that our support becomes differentiated and the focus shifts to getting people back to work. It is not possible to sustain this level of intervention. I fully agree with him: those who are entrepreneurial and self-employed deserve our support, and they will continue to get it as we drive our recovery out of this crisis.

[Gerald Jones]

Hundreds of thousands of people across the country, including many in my constituency, have not been able to get support during this pandemic. The Government have repeatedly said that it is too difficult to get support to people who are not on the coronavirus job retention scheme or the self-employment income support scheme. The Government have had six months to put something in place, so will the Chancellor outline to the House what barriers exist now to getting support to the people who have so far been excluded?

[Rishi Sunak]

As I have said from this Dispatch Box, we have not been able to help absolutely everyone in the exact way that they would have liked, but that does not mean that support is not available. Through considerable increases to universal credit and local housing allowance, we have provided support to the most vulnerable. Through measures such as mortgage holidays, which one in six mortgage customers have taken up in the past few months, we have ensured that everyone, one way or another, can access some degree of Government support.

[Peter Gibson]

Over £33 million of bounce back loans have been granted to businesses in Darlington, but many businesses in my constituency bank with new start-up, online and challenger banks and have faced some issues with accessing bounce back loans. What steps is the Treasury taking to assist with access to bounce back loans for those who need them?

[Rishi Sunak]

My hon. Friend raises an important point, and we recognise the vital role that alternative lenders can play in providing finance to SMEs. We continue to work with them and the sector to see what more we can do. As he recognises, the bounce back loan scheme has proved enormously successful, and so far we have accredited 28 bounce back lenders, who have provided loans to more than 1 million businesses. In the first instance, I urge businesses in my hon. Friend’s constituency to look online at one of those 28 lenders, and see whether they can provide the loans that that business requires.

[Chi Onwurah]

The Chancellor, and all of us whose salaries have been paid throughout the pandemic, may find it difficult to grasp the deep sense of unfairness felt by those who, through no fault of their own, are entirely excluded from any support. Perhaps they followed their entrepreneurial dream and left a good job to start their own business, as encouraged to do by this Government, but did not file their tax returns in time. Perhaps they have an event business that has been left to fend for itself without any events. There are thousands of such people in my constituency alone. How can the Chancellor expect the country to come together to fight the virus when so many have been excluded from all support?

[Rishi Sunak]

I respectfully disagree with the hon. Lady. Most people in the country recognise that the Government have provided unprecedented support at this difficult time to millions of people, as well as to hundreds of thousands, if not millions of businesses. Although people may not have been able to get support in the exact way they would have wanted, across the spectrum, whether through the welfare system and local authorities, or through banks and the provision of credit, we have ensured that some form of support is available to the vast majority of the British public.

[Tracy Brabin]

It is now been six months during which 3 million self-employed people have been excluded and locked out of the coronavirus support schemes, and it is no coincidence that this week the Trussell Trust announced an unprecedented need for support. Nearly half of those people are first-time users, and if the forecasts are right, the situation will only get worse, with six emergency food parcels being delivered every minute as we get to winter. I implore the Chancellor to tell hon. Members what he will do to support those who are excluded, so that this disaster does not turn into a catastrophe for families around the country.

[Rishi Sunak]

The hon. Lady is slightly confused. On one hand she speaks about people who were not eligible for the self-employment scheme, but those who were excluded earned more than £50,000 and were in the top 5% of all earners, with an average median salary of £200,000. In the same question she speaks about targeting support to those who cannot afford food. She should figure out which issue she cares about.

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

When the circumstances change, policies should adapt. Infection rates are growing, local restrictions are becoming more common, and this morning’s figures show levels of unemployment at a two-year high, and rising, particularly among the young. France and Germany have extended their employment support for a further year. Is it time to reconsider the jobs cliff edge that is approaching at the end of next month, and at least to extend employment support to those sectors that cannot yet go back to work, and areas hit by local lockdowns, so that businesses and workers are not punished for doing the right thing?

[Rishi Sunak]

The right hon. Gentleman is right to highlight the increase in cases, which is why the Government have taken steps to ensure that we remain in control in suppressing the virus. He talks about local lockdowns, and he will have seen the announcement last week about extra business rates support for businesses that find themselves in those areas, with a payment of up to £1,500 per three weeks of lockdown. He mentioned other countries. He is right about Germany and its scheme, but it is worth bearing in mind that Germany has had such a scheme, in co-operation with businesses and through its social security system, for more than a decade.

[Mr Speaker]

I call the Chair of the Public Accounts Committee.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

As you might expect, Mr Speaker, the Public Accounts Committee is already beginning the reckoning of costs, and there is a cost to the Exchequer from all those people who were self-employed, or employed on short-term contracts, and who received no support. Ultimately, the state still has to support those people, and no tax comes in from them. Will the Chancellor go back to the drawing board and consider the long-term issue of the cost to our country of not supporting people who have a good track record with HMRC and who could be supported? They have lived on fresh air for all these months.

[Rishi Sunak]

I hear what the hon. Lady says and will certainly reflect on it. I refer her to my response to the question from my hon. Friend the Member for Penistone and Stocksbridge (Miriam Cates) about the importance of a digital taxation system, which I know the hon. Lady’s Committee will have an interest in. As throughout this crisis, our ability to respond in the way that we would want to is often limited by the information that we hold. My right hon. Friend the Financial Secretary to the Treasury has put out a 10-year tax administration strategy that will ensure that our tax system collects in real time the information we need about people and businesses up and down this country, so that, should something like this happen again, the Government can respond in the way that they would want to, as quickly as possible.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

What discussions he has had with Cabinet colleagues on introducing an online sales tax.

--- Later in debate ---

[Patricia Gibson (North Ayrshire and Arran) (SNP)]

If he will make a statement on his departmental responsibilities.

[The Chancellor of the Exchequer (Rishi Sunak)]

This Government’s comprehensive and generous package of support in response to the coronavirus has protected millions of livelihoods and supported hundreds of thousands of businesses up and down the country. Our plan for jobs announced in July will protect, create and support jobs, notably through our recently launched kickstart scheme, as we look to get the UK economy back on its feet.

[Patricia Gibson]

Scottish Government analysis has revealed that ending the transition period in 2020 could cut £3 billion from the Scottish economy over the next two years—on top of the impact of coronavirus. With the UK Internal Market Bill making the risk of a no-deal Brexit even greater, what reassurances can the Chancellor give to my constituents and the people of Scotland that there will be no real-term spending cuts that will inflict even greater damage on our economy?

[Rishi Sunak]

The Government and I remain committed to getting a deal and will continue to engage constructively with our European partners in pursuit of that aim. With regard to funding for Scotland, I can tell the hon. Lady that the Scottish Government have received £6.5 billion in advance of it being called for, so that they can provide the support required to their residents.

[Shaun Bailey (West Bromwich West) (Con)]

Innovation has been at the heart of the story of the Black Country for over 150 years—and nowhere is this more true than in companies such as Thomas Dudley in Tipton in my constituency and Stephens Plastic Mouldings in Oldbury. Given that these are the types of businesses that will help us as we come out of the pandemic, what work is my right hon. Friend doing with manufacturers and exporters in the Black Country, and with local stakeholders such as the West Midlands Combined Authority and West Midlands Mayor Andy Street, to show that they have the support they need to thrive and survive post pandemic?

[Rishi Sunak]

My hon. Friend is absolutely right. Manufacturing and exports, especially from the west midlands and the Black Country, will play a key part in driving our recovery. I am pleased to tell him that the Exchequer Secretary is shortly meeting with the Mayor, Andy Street. That comes on top of our plans to provide £1 billion to develop the UK supply chain for electric automotive vehicles over the next five years, and £850 million of allocations from the local growth fund for his region.

[Anneliese Dodds (Oxford East) (Lab/Co-op)]

The Chancellor will be aware of concerns that the UK risks a slower recovery than comparable economies for self-inflicted reasons. Despite the devastating impact on jobs, the Treasury Front Benchers have yet again today—six times—rejected targeted wage support. Economists are concerned about this Government’s inability to get a grip on the public health crisis, which evidence from the Scientific Advisory Group for Emergencies suggests stems in part from a failure to adequately support people who have to self-isolate. Rumour has it that the Chancellor is blocking attempts to improve sick pay, so I put it to him: can he put himself in the shoes of those low-paid workers who often have to choose between paying their rent and bills, and putting food on the table for their kids? If these workers are advised to self-isolate, they get £95.85 a week—and that is if they are even eligible for statutory sick pay. Surely the Chancellor must agree with the Secretary of State for Health that statutory sick pay is not enough to live on.

[Rishi Sunak]

From the beginning of this pandemic, we have made changes to the operation of statutory sick pay and our welfare system to ensure that those who are isolating in any circumstance receive support from day one, and that we improve flexibility, particularly for the self-employed, through the removal of the minimum income floor. As the hon. Lady knows, we are also trialling incentive payments in local lockdown areas.

[Anneliese Dodds]

I did not ask the Chancellor about the precise details of delivery and I did not ask about the scope; I asked him about the value of statutory sick pay. He needs to get a grip on this issue. If he fails to do so—and the blockage appears to be his responsibility—then we will see additional localised re-impositions of lockdown, with all the implications that has for jobs and businesses. Please, Chancellor, get a grip on this issue.

There are two other reasons why economists are worried about the UK’s recovery. First, of course, there is concern about our future as a trading nation. Both of the Chancellor’s predecessors warn that the threat to override the withdrawal agreement could damage our country’s reputation and prosperity. Why do those former Chancellors appear to be more concerned about our country’s economic prospects than the current one? The second reason for concern stems from the prospect of premature spending cuts or tax rises. According to the Financial Times, it is politics that could drive the Chancellor towards early tax rises, so will he rule them out for the rest of this year?

[Mr Speaker]

Order. I do want the Chancellor to answer, but we will have to shorten the questions.

[Rishi Sunak]

The hon. Lady talks about our place as a trading nation. She may have missed the news last week that this country has concluded an enhanced free trade agreement with Japan. I pay enormous tribute to my right hon. Friend the Secretary of State for International Trade for concluding a deal that will be better for British businesses, particularly in the areas of the economy we do so well on such as digital and services. It will protect more of our great agricultural produce, open up more markets for our businesses to sell to and reduce prices for British shoppers. That is what the future of global Britain looks like.

[Joy Morrissey (Beaconsfield) (Con)]

I thank my right hon. Friend for his support for local businesses in Beaconsfield and across the UK. What provision or safety net is he creating for local businesses that may be affected by lockdowns across the country?

[Rishi Sunak]

My hon. Friend makes an excellent point and I thank her for it. She will know that some of the interventions we have already put in place last through into next year, for example the removal of the need to pay business rates for businesses in hospitality, which has been particularly affected. She may be reassured to know that we recently introduced the new business support grant for businesses forced to close as a result of local lockdown, where the Joint Biosecurity Centre gold command has instituted that measure, and those grant payments will be available up to £1,500 per few weekly cycles.

[Sammy Wilson (East Antrim) (DUP)]

  The aviation industry is on its knees: airports are deserted, planes are grounded and travellers are frustrated. In large part, the plight of the industry is due to the inconsistent, illogical and contradictory policies being followed by the Government to attack coronavirus. Will the Chancellor consider what actions he can take to support this vital industry, which we depend on for our connectivity, by either reducing or suspending air passenger duty, or through targeted job support?

[Rishi Sunak]

The right hon. Gentleman is absolutely right to highlight the importance of the aerospace industry to our economy. It is, in common with aerospace industries across the globe, suffering a deep depression in demand for all the obvious reasons. He can rest assured that we engage regularly with the companies in that sector. In particular, to support their future success, we are investing heavily in R&D alongside those companies to make sure we remain on the cutting edge of advanced manufacturing capability.

[David Simmonds (Ruislip, Northwood and Pinner) (Con)]

  Does my right hon. Friend agree that the benefits of the Government’s tax-free childcare scheme, which gives eligible families a 20% contribution to the cost of childcare and works alongside the 30 hours funded childcare that is available to working families, cannot be overstated as the economy reopens to my constituents and across the UK?

[Rishi Sunak]

My hon. Friend is absolutely right to highlight the importance of good childcare and he is right to highlight that the Government support people with 20% of their childcare costs up to a cap of £2,000 through tax-free childcare. I can also tell him that, in recognition of the importance of this issue, we made some adjustments to how tax-free childcare operated during the pandemic, so that if someone’s income fell below the minimum income requirement as a result of what was happening they would continue to receive financial support up until the end of October.

[Derek Twigg (Halton) (Lab)]

At the end of August in my constituency, there were 2,000 more people unemployed than there were in March. The number of 18 to 24-year-old claimants has almost doubled. If history teaches us anything, it is that young people and those living in deprived areas will be more adversely affected by any downturn in the economy. What special measures is the Chancellor considering putting in place for young people in areas like mine, which are the most deprived?

[Rishi Sunak]

The hon. Gentleman is absolutely right to highlight the disproportionate economic impact that this crisis will have on young people. I have spoken about that from the Dispatch Box before, and he is right that we should focus our attention on them. That is why, in our plan for jobs, we outlined the kickstart scheme, which will initially make available fully-funded Government job placements for a quarter of a million young people at risk of long-term unemployment. I am confident that many young people in his constituency, like all of ours, can benefit from that scheme, and I urge him to work with his local businesses to get them signed up to the scheme and take on a young kickstarter.

[Craig Whittaker (Calder Valley) (Con)]

  I recently had the pleasure of visiting Smart Display, a great Calder Valley business in the events and exhibitions sector, which supports over 28 employees. While it praises the sterling work done by my right hon. Friend to support businesses through furlough, CBILS—the coronavirus business interruption loan scheme—and rate relief, many businesses in its sector were among the first to close and will be the last to reopen, with many exhibitions not planned until next year. Can my right hon. Friend take this into serious consideration during the Budget process to see what additional measures he could take to support these businesses, which are the hardest hit financially by the pandemic?

--- Later in debate ---

[Rishi Sunak]

It is right that companies pay the tax that they owe the Exchequer so that we can fund the public services that all our constituents rely on. That is why this Government instituted the digital services tax for online companies, which came into force this year. We remain committed to that tax, although we work with our partners around the world to replace our unilateral one with a multilateral solution through the OECD that will properly tackle this issue once and for all.

[Mark Pawsey (Rugby) (Con)]

Businesses in Rugby and Bulkington have told me universally how they welcome the measures that the Government have introduced for their speed and their breadth, but they know that the coming months will be difficult for trading and there are tough times ahead. Which of the Government’s measures, given limited resources, does the Minister think are the most appropriate to support businesses over the next few months?

Office for Budget Responsibility: Economic and Fiscal Forecast

Rishi Sunak Excerpts

Friday 11th September 2020 Written Statements

[The Chancellor of the Exchequer (Rishi Sunak)]

Today I can inform the House that I have asked the Office for Budget Responsibility (OBR) to prepare an economic and fiscal forecast to be published in mid to late November.

[HCWS447]

OBR 2020 Fiscal Sustainability Report and response to OBR 2019 Fiscal Risks Report

Rishi Sunak Excerpts

Tuesday 14th July 2020 Written Statements

[The Chancellor of the Exchequer (Rishi Sunak)]

Today’s publication of the Office for Budget Responsibility’s (OBR) 2020 Fiscal Sustainability Report (FSR) fulfils the OBR’s legal obligation to publish an analysis of the sustainability of the public finances over the long-term and an assessment of the public sector balance sheet at least once every two years. This report has been laid before Parliament today and copies are available in the Vote Office and Printed Paper Office. The OBR also produces a biennial fiscal risks report (FRR) to which the Government are required to respond within a year. This statement provides the Government’s response to Office for Budget Responsibility—Fiscal risks report July 2019 [CP131], laid 18 July 2019^[1].

The action the Government have taken in response to the covid-19 pandemic was necessary to protect public health, support household incomes, and to minimise permanent damage to the economy—thereby supporting growth, employment and the public finances over the medium to long term. As the OBR has said in the FSR:

“The outlook would have been much worse without the measures the Government have taken. These have provided additional financial support to individuals and businesses through the lockdown. They should also help to limit any long-term economic scarring, by keeping workers attached to firms and helping otherwise viable firms stay in business”.

OBR 2020 fiscal sustainability report

The magnitude and duration of the economic shock caused by covid-19 will have important consequences for the medium and long-term fiscal position. In all three scenarios the OBR has published in the FSR, the level of borrowing this year is significantly higher than expected in the OBR’s spring Budget forecast. Public sector net borrowing is projected to reach between 13% and 21% of GDP in 2020-21, with differences across scenarios reflecting the size of the economic shock. This in turn means that public sector net debt is also projected to be higher compared to the spring Budget forecast under all scenarios, although the OBR has highlighted that low borrowing costs help to make this more affordable in the near-term. The gilt market is deep and liquid with a good track record in responding smoothly to increases in gilt supply. Underlying demand for the UK’s debt remains strong, with borrowing costs at historical lows, signalling confidence in the UK’s institutions.

The Government have taken significant action to support the recovery and minimise permanent damage from the pandemic. In the long-run, the OBR also expects demographic change and other cost pressures in health spending to put upward pressure on public spending while leaving revenues broadly unchanged. The Government are committed to fiscal sustainability and ensuring the long-term health of the public finances. The Government will set out further details on their plans to put the public finances back on a sustainable footing over the medium-term at the next Budget, alongside an updated OBR forecast. As part of this, as set out in the March Budget, HM Treasury is reviewing the UK’s fiscal framework to ensure it remains appropriate for the macroeconomic context, while ensuring the sustainability of the public finances. The FSR provides important analysis and scenarios which will be used to inform this review.

Managing fiscal risks from covid-19

In July 2019, the OBR published its second fiscal risks report covering the main risks to the public finances at that time. With covid-19 now clearly the most significant immediate source of fiscal risk facing the UK, this response to the report focuses on how the Government are managing the fiscal risks associated with the pandemic.

The work of the last 10 years in bringing borrowing and debt back under control means that the UK was well-placed to respond to the immediate and long-term challenges posed by covid-19.

The Government acted quickly to implement interventions containing the initial economic shock from the pandemic. When designing these interventions, the Government drew on the experience gained from HM Treasury’s Balance Sheet Review^[2] and international best practice^[3] to ensure that fiscal risks are managed effectively. The IMF commended the Government’s powerful response to the initial shock of covid-19, finding the interventions to be large, substantial and carefully targeted^[4].

In the first phase of the economic response to covid-19, the Government kept people attached to their work, protected their incomes and supported businesses, delivering one of the most generous and comprehensive packages of support globally, with a fiscal response totalling £160 billion. While the economic impacts of covid-19 and the Government’s necessary response have come at a significant fiscal cost, the costs of failing to act to support public services, businesses, and workers would have been much higher.

Building on the action taken in the face of the immediate threat posed by the virus, the Government are now proceeding with the second phase of their response, supporting the UK’s economic recovery while continuing to prioritise people’s health. The plan for jobs announced last week, made up to £30 billion available to help kick-start the nation’s economic recovery while continuing to prioritise people’s health by: introducing a new job retention bonus to encourage firms to keep on furloughed workers; supporting jobs with direct help to find work and to gain the skills people need to get a job; protecting jobs in the hard-hit hospitality and accommodation sectors and at attractions by supporting demand for these businesses, giving them confidence to reopen; creating jobs with action to get the property market moving, to increase and bring forward infrastructure investment, and to make homes greener, warmer and cheaper to heat.

The third phase of the Government’s plan will be set out in the autumn with measures to support the longer-term recovery through a Budget and a spending review. These will detail further plans to invest in public services, to support innovation and growth-enhancing infrastructure with a national infrastructure strategy, to seize global opportunities and to level up opportunity across every region and nation of the UK.

Wider fiscal risk management

While the immediate focus of Government action is on dealing with covid-19, the management of the wider risks facing the UK public finances remains important. The Government have acted to address a number of the risks that were discussed by the OBR in FRR 2019.

To address the long-term challenge of low productivity growth, Budget 2020 announced measures investing in UK infrastructure, backing tech and innovation, making tax changes to support firms to invest, and introducing measures to support a dynamic and competitive economy. The Prime Minister also announced on 30 June that we will be improving the quality, speed and efficiency of delivering infrastructure through a new infrastructure delivery taskforce named Project Speed.

In the longer-term, climate change remains a significant challenge for the wider public finances. Demonstrating the Government’s commitment to mitigating climate change, in November 2019, the Chancellor launched an HM Treasury review into how the transition to net zero greenhouse gas emissions will be funded and where the costs will fall. Spring Budget allocated £640 million for tree planting and peatland restoration, over £1 billion for ultra-low emission vehicles and introduced tax measures to encourage greater energy efficiency and reduce plastic waste. The UK is also increasing its international climate finance support for developing countries to at least £11.6 billion. To improve the UK’s climate resilience, the Government announced a doubling of investment in flood and coastal defences in England to £5.2 billion over the next six years. The devolved Administrations will benefit from the Barnett consequential of this substantial increase in Government investment in flood and coastal defences.

To manage risks associated with non-bank financial intermediation and increase the resilience of the UK financial system, in the remit for the Financial Policy Committee (FPC), HMT recommended that the FPC publishes a detailed assessment of the oversight and mitigation of systemic risks from the non-bank sector. The FPC has confirmed it will publish preliminary findings in the August financial stability report, followed by a more detailed report that outlines gaps in non-bank resilience and potential measures that may be taken to increase resilience.

The OBR also highlighted fiscal risks related to tax reliefs. The Government recognise the need to monitor and evaluate existing tax reliefs; the Government will continue to monitor their use and act where appropriate, for example through the recent reforms to Entrepreneurs’ Relief, and the planned changes to the entitlement to use red diesel. HMRC is committed to increasing the number of published costs of tax reliefs and in May 2020 published cost estimates for another 47 non-structural tax reliefs. HMRC will continue to build on this to increase transparency.

^[1] https://obr.uk/frr/fiscal-risks-report-july-2019/

^[2] The Balance Sheet Review (BSR) was launched in 2017 to identify opportunities to dispose of assets that no longer serve a policy purpose, improve returns on retained assets, and reduce the risk and cost of liabilities.

^[3] https://www.imf.org/en/Publications/SPROLLs/covid19-special-notes

^[4] https://www.imf.Org/en/News/Articles/2020/04/14/tr041420 -transcript-of-april-2020-world-economic-outlook-press-briefing.

[HCWS364]

Economic Update

Rishi Sunak Excerpts

Wednesday 8th July 2020 Commons Chamber

[The Chancellor of the Exchequer (Rishi Sunak)]

I stood here in March saying I knew people were worried, and I know they are worried still. We have taken decisive action to protect our economy, but people are anxious about losing their job and about unemployment rising. We are not just going to accept that. People need to know that we will do all we can to give everyone the opportunity of good and secure work. People need to know that although hardship lies ahead, no one will be left without hope. So today, we act with a plan for jobs. Our plan has a clear goal: to protect, support and create jobs. It will give businesses the confidence to retain and hire, to create jobs in every part of our country, to give young people a better start and to give people everywhere the opportunity of a fresh start. Where problems emerge, we will confront them. Where support is justified, we will provide it. Where challenges arise, we will overcome them. We entered this crisis unencumbered by dogma and we continue in that spirit, driven always by the simple desire to do what is right.

Before I turn to our plan for jobs, let me first outline the nature of the challenge. Our economic response to coronavirus is moving through three phases. In the first phase, beginning in March, the Government announced social distancing measures and ordered businesses to close, halting the spread of the disease. We put in place one of the largest and most comprehensive economic responses in the world. Our £160 billion plan protects people’s jobs, incomes and businesses. We supported more than 11 million people and jobs through the job retention and self-employment schemes, alongside billions of pounds for the most vulnerable. We supported over 1 million businesses to protect jobs through tax cuts, tax deferrals, direct cash grants and over 1 million Government-backed loans. And we supported public services, with new funding for the NHS, schools, public transport and local authorities. In total, we have now provided £49 billion to support public services since this crisis began.

Analysis I am publishing today shows our interventions significantly protected people’s incomes, with the least well off in society supported the most, and this crisis has highlighted the special bond which holds our country together. Millions of people in Scotland, Wales and Northern Ireland have been protected by the UK Government’s economic interventions, and they will be supported by today’s plan for jobs. No nationalist can ignore the undeniable truth: this help has only been possible because we are a United Kingdom.

Four months on, as we carefully reopen our economy, we are entering the second phase of our economic response. Despite the extraordinary support we have already provided, we face profound economic challenges. World economic activity has slowed, with the International Monetary Fund expecting the deepest global recession since records began. Household consumption—the biggest component of our economy—has fallen steeply. Businesses have stopped trading and stopped hiring. Taken together, in just two months our economy contracted by 25%, the same amount that it grew by in the previous 18 years. And the independent Office for Budget Responsibility and Bank of England are both projecting significant job losses, the most urgent challenge we now face. I want every person in this House and in the country to know that I will never accept unemployment as an unavoidable outcome. We have not done everything we have so far just to step back now and say, “Job done.” In truth, the job has only just begun.

If the first phase of our economic response was about protection and the second phase—the phase we are addressing today—is about jobs, there will come a third phase, where we will rebuild. My right hon. Friend the Prime Minister has set out our vision to level up, unite the country, spread opportunity, and repair and heal the wounds exposed through this crisis. I can tell the House that we will produce a Budget and spending review in the autumn.

And we will deal, too, with the challenges facing our public finances. Over the medium term, we must, and we will, put our public finances back on a sustainable footing. In other words, our plan for jobs will not be the last action, but is merely the next, in our fight to recover and rebuild after coronavirus.

Let me now turn to the detail of our plan for jobs. Central to our economic response has been the jobs retention scheme. Furlough has been a lifeline for millions, supporting people and businesses to protect jobs, but it cannot, and should not, go on forever. I know that when furlough ends it will be a difficult moment. I am also sure that if I say the scheme must end in October, critics will say it should end in November. If I say it should end in November, critics will just say December. But the truth is, calling for endless extensions to the furlough is just as irresponsible as it would have been, back in June, to end the scheme overnight.

We have to be honest: leaving the furlough scheme open forever gives people false hope that it will always be possible to return to the jobs they had before. The longer people are on furlough, the more likely it is that their skills will fade, and they will find it harder to get new opportunities. It is in no one’s long-term interests for the scheme to continue forever, least of all those trapped in a job that can exist only because of Government subsidy. So the furlough will wind down, flexibly and gradually, supporting businesses and people through to October.

While we cannot protect every job, one of the most important things we can do to prevent unemployment is to get as many people as possible from furlough back to their jobs. So, today, we are introducing a new policy to reward and incentivise employers who successfully bring furloughed staff back—a new jobs retention bonus.

If you are an employer and you bring back someone who was furloughed, and you continuously employ them through to January, we will pay you a £1,000 bonus per employee. It is vital that people are not just returning for the sake of it; they need to be doing decent work. For businesses to get the bonus, the employee must be paid at least £520, on average, in each month from November to January, the equivalent of the lower earnings limit in national insurance.

The House should understand the significance of this policy. We will pay the bonus for all furloughed employees. So if employers bring back all 9 million people who have been furloughed, that would be a £9 billion policy to retain people in work. Our message to business is clear: if you stand by your workers, we will stand by you.

The furlough was the right policy to support people through the first phase of this crisis, but now, in this new phase, we need to evolve our approach. Today, I want to set out for the House a new three-point plan for jobs. We need to: first, support people to find jobs; secondly, create jobs; and, thirdly, protect jobs.

Let me start with supporting jobs, in particular the help we want to provide for those who will be hardest hit by this crisis: younger people. Over 700,000 people are leaving education this year. Many more are just starting out in their careers. Coronavirus has hit them hard—under-25s are two and a half times as likely to work in a sector that has been closed.

We cannot lose that generation, so today I am announcing the kick-start scheme, a new programme to give hundreds of thousands of young people in every region and every nation of Britain the best possible chance of getting on and getting a job. The kick-start scheme will pay employers directly to create new jobs for any 16 to 24-year-old at risk of long-term unemployment. These will be new jobs, with the funding conditional on the firm proving that the jobs are additional. These will be decent jobs, with a minimum of 25 hours per week paid at least the national minimum wage, and they will be good-quality jobs, with employers providing kick-starters with training and support to find a permanent job.

If employers meet those conditions, we will pay young people’s wages for six months, plus an amount to cover overheads. That means, for a 24-year-old the grant will be around £6,500. Employers can apply to be part of the scheme from next month, with the first kick-starters in their new jobs this autumn. I urge every employer, big or small, national or local, to hire as many kick-starters as possible. Today, I am making available an initial £2 billion, enough to fund hundreds of thousands of jobs, and I commit: there will be no cap on the number of places available.

We can do more for young people. Traineeships are a proven scheme to get young people ready for work, and we know they work, so for the first time ever we will pay employers £1,000 to take on new trainees, with triple the number of places. What is more, to help 18 to 19-year-olds leaving school or college to find work in high-demand sectors, such as engineering, construction and social care, we will provide £100 million to create more places on level 2 and 3 courses.

The evidence says that careers advice works, too, so we will fund it, with enough new careers advisers to support over a quarter of a million more people. We will also expand our universal skills offer. Sector-based work academies provide training, work placements and a guaranteed job interview in high-demand sectors, and the evidence shows they work, so we will expand them, by tripling the number of places.

We know that apprenticeships work, too, with 91% of apprentices staying in work or doing further training afterwards, so for the next six months we will pay employers to create new apprenticeships. We will pay businesses to hire young apprentices, with a new payment of £2,000 per apprentice, and introduce a brand new bonus for businesses to hire apprentices aged 25 and over, with a payment of £1,500. I thank my right hon. Friend the Education Secretary for his support and commitment in developing these measures.

We know that the longer someone is out of work, the harder it is for them to return. Millions of people are moving on to universal credit and need urgent support to get back to work, so we are doubling the number of work coaches in jobcentres, increasing the flexible support fund, extending the rapid response service, expanding the work and health programme, and developing a new scheme to support the long-term unemployed. The academic and economic evidence tells us these are among the most effective things we can do.

For that reason, I am investing an extra £1.2 billion in the Department for Work and Pensions to support millions of people back to work, and I am grateful for everything my right hon. Friend the Work and Pensions Secretary and her incredible team have done. I am talking about £1 billion of support for the unemployed, more money for skills, traineeships, apprenticeships, and a new, good-quality job for hundreds of thousands of new kick-starters. That is the first part of our plan for jobs.

The second part of our plan is to support job creation, and that begins with historic investment in infrastructure to create jobs in every region and nation of the UK. At the Budget, I announced £88 billion of capital funding this year, and last week the Prime Minister announced our plans to accelerate £5 billion of additional investment projects. We are doubling down on our ambition to level up, with better roads, better schools, better hospitals and better high streets, creating jobs in all four corners of the country.

As well as investing in infrastructure, we want to create green jobs. This will be a green recovery, with concern for our environment at its heart, and as part of that, I am announcing today a new £2 billion green homes grant. From September, homeowners and landlords will be able to apply for vouchers to make their homes more energy efficient and create local jobs. The grants will cover at least two thirds of the cost—up to £5,000 per household—and for low-income households we will go even further, with vouchers covering the full cost, up to £10,000.

On top of the £2 billion voucher scheme, I am releasing £1 billion of funding to improve the energy efficiency of public sector buildings, alongside a £50 million fund to pilot the right approach to decarbonise social housing. Taken together, we expect these measures to make more than 650,000 homes more energy efficient; to save households up to £300 a year on their bills; to cut carbon by more than half a megatonne per year—equivalent to taking 270,000 cars off the road; and, most importantly right now, to support around 140,000 green jobs. A £3 billion green jobs plan to save money, cut carbon and create jobs.

One of the most important sectors for job creation is housing. The construction sector adds £39 billion a year to the UK economy. House building alone supports nearly three quarters of a million jobs, with millions more relying on the availability of housing to find work. But property transactions fell by 50% in May. House prices have fallen for the first time in eight years and uncertainty abounds in the market—a market we need to be thriving. We need people feeling confident—confident to buy, sell, renovate, move and improve. That will drive growth. That will create jobs. So to catalyse the housing market and boost confidence, I have decided today to cut stamp duty.

Right now, there is no stamp duty on transactions below £125,000. Today, I am increasing the threshold to half a million pounds. This will be a temporary cut running until 31 March next year, and, as is always the case, these changes to stamp duty will take effect immediately. The average stamp duty bill will fall by £4,500 and nearly nine out of 10 people buying a main home this year will pay no stamp duty at all. Stamp duty cuts, a £5,000 green homes grant and tens of billions of pounds of new capital projects—we are creating jobs: the second part of our plan for jobs.

The final part of our plan will protect jobs that already exist by helping some of our highest-employing but hardest-hit sectors: hospitality and tourism. Our economy relies on consumption, especially social consumption: the pubs, cafés, restaurants, hotels and B&Bs that bring life to our villages, towns and cities. Taken together, these sectors employ over 2 million people—disproportionately younger, women and people from black, Asian and minority ethnic communities. Many rural and coastal communities rely on these industries. Some 80% of hospitality firms temporarily stopped trading in April and 1.4 million workers have been furloughed—the highest proportions of any sector. So the best jobs programme we can do is to restart these sectors and get our pubs, restaurants, cafés and B&Bs bustling again.

I know people are cautious about going out, but we would not have lifted the restrictions if we did not think we could do so safely. I have seen in the last few weeks how hard businesses are working to make their premises safe, and if we follow the guidance and respect what they ask us to do, we can all enjoy summer safely. In turn, we need to give these businesses the confidence to know that if they open up, invest in making their premises safe and protect jobs, demand will be there—and be there quickly. So today, I am announcing two new measures to get these sectors moving and protect jobs.

First, at the moment, VAT on hospitality and tourism is charged at 20%, so I have decided, for the next six months, to cut VAT on food, accommodation and attractions. Eat-in or hot takeaway food from restaurants, cafés and pubs; accommodation in hotels, B&Bs, campsites and caravan sites; attractions like cinemas, theme parks and zoos—all these and more will see VAT reduced, from next Wednesday until 12 January, from 20% to 5%. This is a £4 billion catalyst for the hospitality and tourism sectors, benefiting over 150,000 businesses and consumers everywhere—all helping to protect 2.4 million jobs.

But we will go further. The final measure I am announcing today has never been tried in the UK before. This moment is unique. We need to be creative. So, to get customers back into restaurants, cafés and pubs and protect the 1.8 million people who work in them, I can announce today that, for the month of August, we will give everyone in the country an eat-out-to-help-out discount. Meals eaten at any participating business, Monday to Wednesday, will be 50% off, up to a maximum discount of £10 per head for everyone, including children. Businesses will need to register and can do so through a simple website, open next Monday. Each week in August, businesses can then claim the money back, with the funds in their bank account within five working days. Some 1.8 million people work in this industry. They need our support, and with this measure, we can all eat out to help out. A VAT cut to 5% and a first-of-its-kind Government-backed discount for all—that is the third part of our plan for jobs.

A £1,000 jobs retention bonus; new, high-quality jobs for hundreds of thousands of young kick-starters; £1 billion to double the number of work coaches and support the unemployed; more apprenticeships, more traineeships and more skills funding; billions of pounds for new job creation projects across the country; a £3 billion plan to support 140,000 green jobs; and, in this vital period, as we get going again, VAT cut, stamp duty cut and meals out cut—all part of our plan for jobs worth up to £30 billion.

Governments, much less people, rarely get to choose the moments that define them. What choice there is comes in how we respond. For me, this has never just been a question of economics, but of values. I believe in the nobility of work. I believe in the inspiring power of opportunity. I believe in the British people’s fortitude and endurance. And it is that value, endurance, more than any other that we need to embody now—a patience to live with the uncertainty of the moment and to find that new balance between safety and normality. We will not be defined by this crisis but by our response to it. It is an unambiguous choice to make this moment meaningful for our country in a way that transcends the frustration and loss of recent months. It is a plan to turn our national recovery into millions of stories of personal renewal. It is our plan for jobs, and I commend it to this House.

[Mr Speaker]

Before I call the shadow Chancellor, I inform Members that at the end of questions on this statement, I will call the Chancellor of the Exchequer to move a provisional collection of taxes resolution. Copies of the resolution are available in the Vote Office.

[Anneliese Dodds (Oxford East) (Lab/Co-op)]

Our country has been through a great deal over these past few months. Hundreds of thousands have wrestled with this terrible disease. For many months, people have had to go without being able to embrace their loved ones or even to say goodbye. Tens of thousands have died. Our NHS, social care and other workers had made extraordinary sacrifices. We owe them so much.

The Government have had to take big decisions, too—we acknowledge that—but today should have been the day when our Government chose to build a bridge between what has been done so far and what needs to be done to get our economy moving again. It should have been the day when the millions of British people worried about their jobs and future prospects had a load taken off their shoulders. It should have been the day when we got the UK economy firing again. Today, Britain should have had a back-to-work Budget; but instead we got this summer statement, with many of the big decisions put off until later, as those on the Government Benches know full well.

Labour is a constructive Opposition during this time of crisis. We will not criticise for criticism’s sake. But when the Government fall short we will speak up, and the blunt truth is that we have one of the highest death rates in the world and among the deepest economic damage in the industrialised world from coronavirus. So the very first thing the Chancellor must do is prevent additional economic damage due to the slow public health response of his Government.

As we have seen throughout this crisis, the failure to match soaring rhetoric with meaningful action has consequences for people across our country. Despite all their talk, the Government have failed to create a fully functioning test, track and isolate system. That has damaged public confidence and, in turn, harmed consumer demand. Despite all their talk, the Government have failed to produce a clear system for local lockdowns. The lack of timely information sharing has led, as we all know, to the imposition of an additional wide-scale lockdown in Leicester.

The Government’s contracts with outsourcing firms amount to almost £3 billion, but we still have not got test, track and isolate working properly in the UK, as it is in many other countries, and the Government still have not got a grip on the low value and limited scope of sick pay, risking people’s ability to self-isolate. Fear is corrosive. Fear is hurting our economy. The Government have got to get this right.

Of course, we welcome the Government’s announcement today of targeted VAT cuts on hospitality and tourism and of vouchers to be used in restaurants. Local businesses desperately need that support, and so many low and middle-income people in particular really need help right now. That is why we have repeatedly called for social security to better meet their needs and prevent people risking losing their homes. If delivered properly, these measures should help.

But the Chancellor himself said, when interviewed on “The Andrew Marr Show”, that the best the Government can do to boost demand is to give consumers and workers the confidence and psychological security that they can go out to work, to shop and to socialise in safety. So please, Chancellor, work with your colleagues so our public health response catches up with that operating in other countries. The Prime Minister asked, what have I been doing about that? My party has been repeatedly suggesting solutions to the public health problems facing our country, and we need to adopt them in the UK before this crisis becomes even more severe.

Now the Government must act not just to deal with unemployment as a symptom, but also with its cause. Research reported this week in the “Telegraph” indicates that British workers have already been the biggest casualty in the global jobs cuts. It showed that while jobs markets in many other countries have already fully recovered, in Britain it could take comparatively much, much longer for vacancy levels to return to normal. The levels of unemployment that this country saw in the past were not just an economic waste; they ruined lives. We are seeing the same impacts again—the same devastated high streets and communities robbed of their pride and purpose.

Of course the re-employment bonus announced by the Chancellor is necessary, not least because his Government refused to put conditions on the use of those funds related to employment. But, first, how can he ensure that that money will not just go to those employers who were already planning to bring people back into work and, secondly, what will he do for those firms that lack the cash flow to be able to operate even with that bonus? Related to that, the Chancellor still needs to abandon his one-size-fits-all approach to withdrawing the job retention and self-employed schemes. No one is saying that those schemes should stay as they are indefinitely; the Opposition have never said that, but we have said that the money spent on the job retention scheme must not serve merely to postpone unemployment. The scheme must live up to its name, supporting employment in industries that are viable in the long term. We also need a strategy for the scheme to become more flexible so that it can support those businesses forced to close again because of additional localised lockdowns. There is still time to avoid additional floods of redundancy notices. It is the Government’s duty to help Britain through this and stop employment reaching mass levels again.

We need action to ensure the support needed for key sectors of our economy—for our small and medium-sized enterprises and our manufacturers. While we of course welcome the long-overdue arts and culture package, we still have not heard the Government’s plans for other sectors. Many of us expected to hear them today, but we have not. The Project Birch process has been slow, tortuous and opaque. Large parts of industrial Britain need help to get through this—to keep their employees in jobs and keep their suppliers in jobs. Meanwhile, it appears that there will be no solutions for SMEs who cannot take on additional debt until the autumn. This risks many SMEs going to the wall.

Until now, the Chancellor has described a targeted, sectoral approach as the Treasury “picking winners”, but the necessary public health measures have created losers. As the Chancellor himself said just now, the Government required many businesses to shut down to prevent the spread of this disease. Supporting businesses that are viable in the long run but currently starved of cash flow is not a matter of “picking winners”: it is about protecting our country’s economic capacity for the future. Failure to do so—to make the job retention and self-employed schemes more targeted and focused and to support viable businesses—is driving up unemployment in this country. The claimant count is on course to top 3 million people in June—the highest number since the previous record in 1986. This is the Chancellor’s record, and one that cannot and must not be worsened.

Where unemployment arises as a symptom of economic damage, more must be done to help. Labour repeatedly called for the Government to match the ambitions of Labour’s future jobs fund and Welsh Labour’s Jobs Growth Wales programme, and finally the Government have come forward with a scheme apparently modelled on them—the kick-start scheme. The Conservatives cancelled the future jobs fund, of course, and it has taken almost 10 years for them to catch up. As with their belated adoption of our call for “jobs, jobs, jobs”, perhaps this gives a new meaning to the phrase “Project Speed”. We now need to make sure that the kick-start scheme provides genuinely additional opportunities for young unemployed people. The Government must also recognise the specific challenges faced by older jobseekers, many of whom are becoming unemployed for the first time, and those based in especially hard-hit places. Reimposing sanctions now is punitive and counter- productive when jobseekers need support.

We must be ambitious for the future of our country’s economy. Our ambition should not just be to build our way out of this but to do so in a greener and cleaner way. For this, we need more than the reheated announcements by the Prime Minister last week. Of course the investment announced was welcome, not least because much of it was already committed to by the Government. However, core elements are missing. For example, £50 million to support retrofitting in social homes is just a seventh of what the Conservatives said they would be spending every year. The muddled confusions over stamp duty over the past 48 hours reflect a broader lack of strategy when it comes to house building, particularly for genuinely affordable and social homes. Overall, the UK’s green investment package barely touches the sides of other countries’ commitments. Even with what was announced today, it only equates to just over the value of Germany’s investment in one green technology alone—hydrogen. The Committee on Climate Change has indicated how far behind the UK is in the race to decarbonise. Failure to heed its recommendations is not only damaging to our planet, but it also cuts us out of leading the development of the key technologies of the future. The Conservatives are still refusing to impose conditions on investment to ensure that it contributes to the goal of net zero and that it supports local jobs, uses local firms, leads to sustainable skilled employment in local areas and prevents the use of tax havens and other forms of asset stripping.

If the Chancellor really wants to “build back better”, he must prevent a rerun of the past. From 2010 onwards, we have seen how families’ resilience has been eroded. We entered this crisis with a quarter of families lacking even £100 in savings. In a typical classroom of 30, nine children are growing up in poverty, and our economy is the most regionally unequal in Europe. Our local authorities continue to be cut to the bone, with many standing on the brink of bankruptcy as we speak, and rather than the promise that our NHS and social care services would get whatever they needed this winter—to weather a potential second wave—those words were conspicuously absent from the Chancellor’s speech just now.

Politicians in this House have gone out on our doorsteps to clap key workers, while the lowest paid have struggled to keep a roof over their heads. We must have a new settlement for the future: an end to poverty pay for our social care workers and those who clean our hospitals and deliver our groceries. We want a recognition of the value of the work of those who have been taken for granted for far too long.

There were some initial press reports that the Government were due to announce generalised tax increases or cuts to services this autumn, which were contradicted by the Prime Minister, who rejected whatever had apparently been briefed out by the Treasury—that has happened quite a few times. I say to the Government that, if they do increase taxes during the recovery and cut back on the public services that we all rely on, it will damage demand and inhibit our recovery. Labour is not calling for tax rises. We are calling for growth.

The Tory manifesto committed to no rises in income tax, national insurance or VAT, and therefore it is for the Conservatives to set out how any additional spending will be paid for. It is the Chancellor’s job to ensure that the economy bounces back from this crisis, so that there is money in the coffers to protect the public finances.

Last week, the Chancellor’s colleague, the Prime Minister, tried to claim the mantle of FDR—as we all know. Perhaps now we know why he went for Roosevelt. It is because this week the Prime Minister blamed carers for the failings in the system that his Government had underfunded for the past decades. Now we know why he went for Roosevelt. It is because the last thing that his Government would have wanted was the sign on the desk of Harry Truman, the successor to Roosevelt, which said, “The buck stops here.” If this Government had a sign, it would probably say, “The buck stops anywhere but here”. But they cannot escape their responsibilities: to govern is to choose. It is to choose to finally sort out test, track and isolate, to prevent unnecessary additional unemployment and to build the green jobs of the future. This is a moment when our country needs its Government to help Britain through.

[Rishi Sunak]

I thank the hon. Lady for that contribution. Throughout this crisis, she and I have spoken and, where possible, I have tried to find common ground for our measures with as broad a coalition as possible, including with members of the Opposition. I do feel that it is necessary, however, to reiterate just a few points. She talked about vulnerable people, but, as I said, the analysis published today shows that our interventions have helped the poorest in our society the most. Those are the values of this Conservative Government. We will make sure that no one is left behind during this time of national crisis, and we will ensure that those who are most vulnerable get the support and protection that they deserve

The hon. Lady also talked about jobs and the difference in different countries’ reactions to the labour market. She is right: our economy is more reliant on consumption than other economies. It is also more reliant on social consumption than other economies. That is why the acute difficulty of social distancing and the shutdowns have affected our economy more than others. That is why, to help protect those 2 million jobs in the 150,000 businesses in those sectors and the people who are, on average, lower paid—women, black and minority ethnic communities, and rural and coastal communities—we have put in place what I believe to be bold and decisive measures to help protect employment in those sectors.

The hon. Lady talked about conditionality on funds that we provided. Here, she has to choose. It cannot be that you can develop significant interventions to provide liquidity and cash support to businesses at scale and speed, while at the same time having an incredibly targeted approach, imposing conditions on individual businesses. You have to choose one or the other. We unashamedly chose the former. The speed of what was happening to our economy and the scale of what was happening demanded an approach that required us to take a broad-brush approach, and that was the way we could get help to as many people as possible as quickly as possible. But where individual businesses come to the taxpayer and require bespoke support, it is right that we impose conditions on those businesses. I have been very clear that that is what I would do and, indeed, that is what we have done. Without going into the details, as that would be inappropriate, such interventions will come with conditions: conditions on executive pay, protecting employment, climate change obligations, how supply chains and small businesses are treated, and obligations around tax. Those are all commitments and conditions that the taxpayer would expect us to make and that is what we have done in the one instance where the support has been provided thus far. It is what we will do for any future support.

The hon. Lady talked about a green recovery. This Government are proud of their record on our environment. She talks about Germany and other countries. When I stood here in March, we outlined one of the most ambitious and far-reaching investment programmes for our environment and tackling net zero from any Government this country has ever seen. Carbon capture and storage, the nature for climate fund, investing to further the support for electric vehicles, new charging stations, tackling air quality, taxes on polluters—those are all measures we have already taken. I am glad that other countries are catching up. We have decarbonised faster than almost every other European country. It is a record that those of us on the Government Benches are proud of.

The measures we have announced today represent some of the most far-reaching measures any country has taken to tackle energy efficiency. They will provide thousands of pounds of grants for homeowners up and down the country to create local jobs and ensure we can reduce carbon emissions from our housing stock, which today account for almost a fifth of all our emissions. The Committee on Climate Change has said we must address that. In our manifesto, we committed to addressing it. Rather than waiting to get started and rather than the five-year plan outlined in our manifesto, we are getting on with it today.

The hon. Lady spoke about furlough. Here again, I make no apology for the fact that we must and should wind down this scheme. I am glad that today the OECD made it clear that it also believes wage support schemes must be carefully wound down in order to get people back to work, protect jobs and return to growth. I see the hon. Lady has moved around on this issue. She said at the end of May that a targeted approach would “pose challenges” and force “hard choices”. I have not heard from the hon. Lady how she would solve those challenges and hard choices, but we remain committed to protecting people in their jobs. We understand that businesses that have had to furlough employees have been through a difficult time, which is why today we outlined a £9 billion policy—the job retention bonus—to support workers and to support businesses who bring those furloughed workers back.

Lastly, the hon. Lady talked about the future jobs fund. I am guided by the evidence. Parts of that scheme did work well and I am not dogmatic—I will do what works—but there are major differences to the kick-starter scheme. The kick-starter scheme will be bigger. It will help more young people. It will be broader, involving the private sector. It will be better value for the taxpayer, ensuring less money is spent on administration fees and more money is in the pockets of young people working.

We have questions from the hon. Lady, We have opinions from the hon. Lady, and last week, we even had tests from the hon. Lady. The one thing we do not have from her is a plan. I closed my statement by saying that this Government were making an unambiguous choice to make this moment meaningful for our country. Now, Labour Members must choose. Do they believe, as we do, that Britain has the energy and power to bounce back? Do they have confidence, as we do, in our incredible public services? Do they believe, as we do, in the enterprising spirit of British business? If they do, then they should do what is right and back our plan for jobs.

[Mel Stride (Central Devon) (Con)]

My right hon. Friend’s plan for jobs is characteristically thoughtful, creative and bold, and I firmly welcome it. He has rightly said that we look to businesses to grow the jobs of the future, yet we know that many hundreds of thousands of small and medium-sized enterprises will emerge from this crisis saddled with significant amounts of corporate debt, and we will look to them at that moment to be investing in jobs and growth, rather than being concerned about de-leveraging and shoring up their balance sheets. So may I ask my right hon. Friend whether he has given this particular issue specific thought, and if he has, what solutions he might have to bring to this House?

[Rishi Sunak]

I very much welcome my right hon. Friend’s support, and thank him for that. I also thank him for the advice he has provided to me over the past few weeks and months. He is right to highlight the issue of leverage; it was good that, on coming into this crisis, levels of corporate indebtedness in the UK were the lowest for around a decade and ranked very favourably when compared with most OECD countries, but he is right that we want to make sure that that is not a drag on our recovery. I am currently looking at proposals from a range of people, including my hon. Friend the Member for Hitchin and Harpenden (Bim Afolami), TheCityUK and others, and I look forward to discussing those with my right hon. Friend.

[Alison Thewliss (Glasgow Central) (SNP)]

I would usually start by thanking the Chancellor for advance sight of his statement, but today I think I might ask for a fresh printer cartridge for the heavily redacted copy, which was effectively useless, that was sent to spokespeople ahead of his statement.

Countries around the world have supported their people in this crisis, and the only UK exceptionalism is in being among the countries where the most people have died. The Chancellor has spent big over the past few months and comes with more proposals today. We support measures such as the job support schemes and encourage the Chancellor to be more ambitious and think to the future in his stimulus plans; we want a comprehensive plan to support the economy, protect jobs and incomes, and build a greener, fairer society.

We have looked to the ambitious stimulus packages of our European neighbours and urge the Chancellor to look at a package of investment with no less than £80 billion of new money, equating to approximately 4% of UK GDP, the equivalent investment to that being made by Germany. That would allow for the level of investment needed to secure jobs not just now, but for the future, because we know that Brexit is coming over the horizon.

The Scottish Parliament currently has a very restricted ability to borrow, under a fiscal framework that was not designed with covid-19 in mind. Kate Forbes, Rebecca Evans and Conor Murphy, the Finance Ministers of all three devolved institutions, have come together to seek urgent devolution of the financial powers in these unprecedented times and to be able to have the flexibility to switch from capital to revenue spending. The Scottish Parliament must have the full range of powers to deliver a tailored response and secure a strong recovery for Scotland, otherwise necessary spending on coronavirus will mean cuts elsewhere and fixed budgets. And will the Chancellor be clear on what these proposals today mean for the block grant adjustment?

The National Institute of Economic and Social Research has said today that UK GDP could be cut by 2.5% if the Chancellor goes ahead and withdraws the job support schemes prematurely. Roz Foyer, general secretary of the Scottish TUC, has called for the continuation of the scheme, noting that hospitality, tourism, aviation, and oil and gas are in particular need of extended support—and there was not a word about oil and gas in the Chancellor’s statement.

Those shielding and with caring responsibilities will also need ongoing support. Coronavirus is not going away, and there is a real risk that with future outbreaks, such as happened in Leicester, the support will not be there when it is needed. I hear what the Chancellor says about encouraging people back to work and about a bonus for employers who do, but for many people it will not be safe to go back to work. At the start of this crisis my inbox was full of correspondence from people worried about the safety of their workplaces, and people should not be forced to go back if it is not safe for them to do so.

Recent Treasury Committee reports and work by Excluded UK highlight the substantial gaps in the coronavirus job retention scheme and the self-employment income support scheme, with between 1 million and 3 million people left with no support whatsoever. People were furious at the suggestion by the Chancellor yesterday that they have had support; they asked me to assure him again today that they have not. The SNP believes that the Chancellor must fill these gaps and extend the furlough and self-employment income support schemes for as long as each of the four nations require that, so that no one is left behind.



A report by the Social Mobility Commission last week warned that UK child poverty is projected to increase to 5.2 million by 2022, with covid-19 adding to this problem. Now is the time to strengthen measures to reverse rising child poverty, including a £20 per week increase in the child element of universal credit and child tax credits. That will help families put food on the table and clothes on children’s backs at a time when many are struggling. These parents are not eating out. Some of these parents are barely eating at all.

The Tories must also scrap the callous two-child cap, re-establish child poverty targets, introduce a real living wage for all ages and roll out an emergency basic payment plan to protect families. We want to see investment in a national debt plan to support businesses, families and individuals who have been struggling. While I am glad to hear that the Chancellor wants to re-employ jobcentre staff, will he reopen the many jobcentres he closed in Glasgow?

We support a temporary reduction in VAT, and we are glad to see the Chancellor coming forward with plans—we have been calling for this since March. He mentioned cinemas. Will live events also see a VAT reduction in their ticket sales? Gigs and theatres would benefit hugely from being able to offer that. All this sits alongside a 2p cut we are calling for to employers’ national insurance contributions, to protect jobs and reduce the cost of hiring staff.

Our bright, talented young people are worth so much more than 25 hours a week on minimum wage, rather than a real living wage, with age discrimination baked in. For many of those young people, it will not be so much a kick-start as a kick in the teeth to be told to go to work for so little money. Those aged between 16 and 24 have bills to pay too, and they deserve fair pay for their work. I note that the Chancellor cited the higher band of pay for a 24-year-old, not the £6.45 an hour for younger people or the £4.55 that 16 and 17-year-olds get—an absolute pittance. There should be a real living wage for all.

If, as has been trailed, this plan is tied to universal credit, can the Chancellor confirm whether sanctions will be applied to those who do not take it up? What will happen to those shielding or with caring responsibilities? What will happen to those not currently on universal credit—will it be open to them? What commitment will he require from employers not to fire older, more expensive staff in favour of people on this scheme? What will happen after six months? What is open to older people to help them continue in employment? Many young people are already employed in sectors where jobs are disappearing right now. Many are already on furlough. Would it not be less disruptive to maintain that link with employers, rather than make them start over?

The voucher scheme that the Chancellor proposes for green plans is, relatively speaking, tinkering when we look at the comprehensive work that the KfW Development Bank in Germany has done to change the whole conversation around green investment. We want to put significant and sustained investment in the future at the heart of these plans and to ensure that Scotland has the widest possible range of powers to tackle covid-19. Only by doing that can we avoid the worst of this storm and protect both businesses and the health and wellbeing of our people.

[Rishi Sunak]

I thank the hon. Lady for her questions. I will run through them as quickly as I can. She asked about the block grant adjustment. The OBR will do final costings for these policies in the coming week, and once those costings have been done, the block grant will be adjusted as quickly as possible. It should be done based on OBR costings, as is normal for these matters.

The hon. Lady asked about Barnett. I am pleased to tell the House that the sum total of Barnett funding for Scotland as a result of all the interventions through this crisis is now £4.6 billion, which is going to support similar measures in Scotland to the ones we are providing elsewhere.

The hon. Lady asked about the inclusion of different businesses in the VAT cut. For attractions, I refer her to principal VAT directive annex III, paragraph 7, where the existing legislation is drawn. The guidance will be published tomorrow, for SIs to be laid next week and to come into force on Wednesday. That paragraph has the full range covered in our existing legislation.

It is absolutely important that we invest in our future. This is something that matters keenly to both me and the Prime Minister, which is why, in the Budget, we delivered on the Prime Minister’s ambitions to level up in every part of this country with investment plans that tripled the amount of investment in our country from the last four decades. It is a significant commitment of our level of ambition and support for every part of this United Kingdom, building prosperity for the future by having an investment revolution. The hon. Lady can be reassured that we remain committed to that goal.

The hon. Lady also asked about support for those who are older. Not quite for the first time, although the only other time that we did it was very time-limited, we are introducing a payment to businesses to take on apprentices over the age of 25—£1,500 per apprentice taken on—for the simple reason that while most people think of apprentices as young people, some 44% or so of new apprentice starts are actually over the age of 25. It is important that we provide that financial incentive at this time of economic distress, to try to create as many new apprenticeships as possible, including for those who are older, who will of course also benefit from all the other universal skills interventions that my right hon. Friends the Secretary of State for Work and Pensions and the Secretary of State for Education will take forward.

More broadly, the measures that I announced today—the jobs retention bonus for furloughed employees, the kick-start scheme, the VAT cut and the “eat out to help out” discount—are all incredibly significant interventions and all of them benefit the entire United Kingdom. It is important to note, as I have heard from the hon. Lady and other members of her party, how important tourism is to the Scottish economy—something that my Scottish colleagues have made clear to me. Rural communities and coastal communities especially play a disproportionately important part in the Scottish economy. The “eat out to help out” measure and the VAT reduction for these economies will be absolutely vital in driving Scotland’s growth going forward. That is a reminder to everyone that we are stronger together, one United Kingdom.

[Sir Peter Bottomley (Worthing West) (Con)]

I welcome the positive approach that the Chancellor and the Government are taking. Were we to ask them, I think many MPs who will not be able to ask a question today would share my view that we should be green, red and blue: green by having economically and environmentally sustainable ways of getting the economy to come back; red by watching out for things that we should not be doing; and blue by being colour blind and trying to make sure that whether they are on the coast, in the countryside or in the cities, people get opportunities.

I hope that the Chancellor will pay attention to what the hon. Member for Glasgow Central (Alison Thewliss) said for the SNP about those excluded. The new all-party group is very concerned about those who have not been caught up by some of the support schemes. They need help and I hope that the Chancellor will find some way of bringing that forward as well.

Let me give just one example of the red—of what not to do. I am putting down an early-day motion—a prayer against Statutory Instrument 2020 No. 632, which goes under the name of the Town and Country Planning (Permitted Development and Miscellaneous Amendments) (England) (Coronavirus) Regulations 2020. It allows two storeys to be built on blocks of flats built between 1948 and 2018—I do not have a personal interest in this matter, by the way—which will potentially wreck the lives of leaseholders who want to get their freehold and put the price up so that people like Vincent Tchenguiz can go stuffing his pockets again at the risk of the pockets and the expense of leaseholders.

Will my right hon. Friend look at this matter and ask whether there can be a better housing adviser in No. 10 and in the Ministry of Housing, Communities and Local Government, to make sure that they do not get things wrong again?

[Rishi Sunak]

I am grateful for my hon. Friend’s support and am happy to talk to him about the matter that he raised. I agree with him that there must be a green recovery—something he has championed for a long time—and it will be a green recovery.

[Sir Edward Davey (Kingston and Surbiton) (LD)]

I thank the Chancellor for the positive measures that he has announced, but why was there absolutely nothing serious for the self-employed? With unemployment rocketing—perhaps up to 3 million—and the climate emergency already hitting us, why is the Chancellor’s ambition for a green recovery so small? Surely we need far more green jobs, now and in future. Why is he not being as radical as European countries such as Germany and France, with a massive green fiscal stimulus for the technologies and industries of the future? Surely even his own home insulation plan should be three times as big and last five years to get real investment in our homes, to decarbonise, and to get the green jobs for our young people and for every community throughout our country.

[Rishi Sunak]

The right hon. Gentleman asked about the self-employed; he will know that our self-employment scheme is without doubt one of the most comprehensive and generous—if not the most comprehensive and generous —anywhere in the world. That is considerable support that has already been provided. Also, 40% of those in the construction sector are self-employed. Many of the people installing the new energy-efficiency measures will be in that category and will benefit from that increased demand for their services—something that I am delighted will happen. Lastly, the right hon. Gentleman talks about Germany, as do other Members; it is important to remember that Germany’s plan for this €50 billion is one with unspecified dates stretching over five years. In March, we unveiled a £640 billion investment plan for the next five years.

[Sajid Javid (Bromsgrove) (Con)]

I commend my right hon. Friend’s statement and the actions he has taken to ensure that we get the strongest possible recovery. He has been absolutely right thus far to spend “whatever it takes”—something he set out clearly back in March—but he will be acutely aware that interest rates will not stay low forever and that we will eventually need to bring our national debt back under control in order to sustain recovery, continue to create jobs and keep taxes low. So may I encourage him to set out new fiscal rules in his autumn Budget with the aim of getting our national debt down as a proportion of our national income by the end of this Parliament?

[Rishi Sunak]

I thank my right hon. Friend for his kind support and also his advice. He is of course absolutely right, and I hope that he was heartened by what he heard me say in the statement about the importance of returning our public finances to a sustainable footing in the medium term. We can and will do exactly that. He is right to highlight the sensitivity of our debt to interest rates, which was why he was right to introduce into our fiscal framework the notion of an interest service rule, and that is something that I will look at keenly in the coming months.

[Sammy Wilson (East Antrim) (DUP)]

I welcome the announcements that the Chancellor has made today to undo some of the economic damage caused by the actions taken to deal with the health crisis. I echo his point that these measures benefit places such as Northern Ireland only because we are part of the fifth biggest economy in the world and we have the umbrella of the UK to protect us against these economic crises. I am sure that the hospitality industry will welcome the measures that he has announced today, although they are quite time-limited. Clothes shops might welcome similar measures as well, because once we have eaten our way through a month’s half-price meals, we might need to visit them!

Other sectors that are important to Northern Ireland in terms of their export potential, high-value jobs, tourism and connectivity with the rest of the United Kingdom are the aerospace and aviation sectors, but there has been no mention of those sectors today. The Chancellor has said that these are the first of his steps, so I hope that we will quickly see some action taken to deal with those areas.

[Rishi Sunak]

I am grateful for the right hon. Gentleman’s support. Perhaps alongside the “eat out to help out” scheme, we can make progress on reopening our gyms, to deal with that side of the equation at the same time. He is absolutely right to suggest that airlines and aviation are experiencing a difficult period. I remain in close contact with the industry and with individual companies to understand what is happening, and if there are things that we can and should do, of course we will.

[Laura Trott (Sevenoaks) (Con)]

Many Opposition Members would have us extend the furlough scheme indefinitely, but that would simply extend false hope. Does my right hon. Friend agree that bold demand-side measures, such as “eat out to help out” and the VAT cut, are much better ways to protect jobs and our much-loved businesses?

[Rishi Sunak]

My hon. Friend is absolutely right, and the OECD agrees with her. We should not be peddling false hope to people. We should be providing a better future for them, and that is what our interventions today will do.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op) [V]]

May I give a cautious welcome to the Chancellor’s emphasis on young people, employment and training? Many of us across the House have a lot of experience of schemes like this, some of which have worked better than others. We would be willing to work with him to make this a success. There is disappointment, however, that he has not accepted my challenge to introduce a windfall profit tax like the one Mrs Thatcher introduced in order to pay for a massive green apprenticeship scheme.

Lastly, on a very serious point, if we are going to train these young people, we have to have the capacity to do so. Further education colleges are in deep trouble, and they need help now. Private trainers, including some in my constituency, are struggling to maintain their existence. Will the Chancellor look at this urgently, because we need the trainers to train these young people?

--- Later in debate ---

[Rishi Sunak]

The hon. Gentleman will be pleased to know that I am very happy to take advice on how best to design these schemes. I hope that he will take some comfort from the fact that I have just been talking to Frances O’Grady of the TUC. I am very open to hearing advice from the unions, which I know were involved in helping to design previous schemes.

With regard to green jobs, the measures that we have announced today will help to protect 140,000 green jobs. I agree with the hon. Gentleman about the importance of training, which is why in the Budget we announced £400 million extra, I believe, for further education colleges’ funding this year and an ambitious plan to upgrade the entire FE estate over the coming years.

[Mr Richard Holden (North West Durham) (Con)]

Most constituents in North West Durham and across the country will welcome the massive cash boost for employers who both hire our young people and protect employees with our new jobs retention bonus. Does my right hon. Friend agree with me that, alongside the confidence and demand boost delivered by his VAT cut and other measures in this extra Budget, the measures on employment show that this Conservative Government are putting jobs at the heart of our recovery from the global coronavirus pandemic?

[Rishi Sunak]

My hon. Friend is absolutely right. I know that he shares with me a passionate belief, as I said, in the nobility of work. This plan today is about providing everyone in North West Durham and every other part of the country with the opportunity to secure good work.

[Margaret Greenwood (Wirral West) (Lab) [V]]

This week saw the first meeting of the ExcludedUK all-party parliamentary group, an APPG for the excluded, the estimated 3 million people who have missed out on Government support and are facing real financial hardship. I note that the Chancellor has avoided answering questions on this matter so far today. May I explain to him, the excluded include people on zero-hours contracts, the directors of small companies paying themselves through dividends, and many self-employed people? In my constituency, that is taxi drivers, joiners, beauticians, childminders, care workers, driving instructors, IT consultants—the list goes on. Will the Chancellor look again at providing support to the excluded, so that they, too, can play their part in the recovery?

[Rishi Sunak]

I have not avoided answering the question; I have answered it not just today, but on every other occasion that I have been at this Dispatch Box. We have provided comprehensive support to many millions of people, especially the self-employed—more generous and comprehensive than any other country—and I have acknowledged that we have not been able to help everyone in the exact way that they would like but, because of the strengthening of our welfare system that we put in place and our universal loan schemes, everyone has been able to access some form of support.

[Saqib Bhatti (Meriden) (Con)]

I thank my right hon. Friend for his characteristically timely and bold interventions, which will be welcomed by a lot of nervous households across the country. My constituents in Meriden are very environmentally focused and will welcome the green homes grant. Does he agree that it is about not just protecting the environment but creating jobs and giving the greatest benefit to those households on the lowest incomes?

[Rishi Sunak]

My hon. Friend is absolutely right. Those on the lowest incomes will receive grants of up to £10,000 to cover the full costs, but that is a policy that does all three things: it will create local employment in communities, which right now is what we want; it will save households money on their bills, up to £200 or £300 for typical cavity wall insulation; and it will cut carbon, with the average house installing these measures saving the equivalent carbon of a flight from London to New York. This is a policy that does what we need right now—cuts carbon, creates jobs and saves cash.

[Nick Smith (Blaenau Gwent) (Lab)]

To boost employment in Blaenau Gwent, we need to help more people get on the Ebbw Vale train to Cardiff, but the line needs to be redoubled, with improved signalling and bridging works. A business plan is in the pipeline from the Welsh Government. Will the Chancellor commit to follow through and please look at providing the investment for jobs that we need—in short, to do what is right for the people of the south Wales valleys?

[Rishi Sunak]

I am very happy to look at the proposal from the hon. Gentleman, and I am sure that the Transport Secretary is fully abreast of it. I will pick it up with him as well.

[John Redwood (Wokingham) (Con)]

The focus on jobs, and the measures, are excellent, so will the Government now review the taxes, subsidies and public procurement regulations so that they can be amended to allow us to grow more of our own food, land and process more of our own fish, generate more of our own power, and supply more of the things that our health service and Ministry of Defence require, because it can be better made in Britain, and better made with British jobs?

[Rishi Sunak]

I thank my right hon. Friend for his support, and he is absolutely right: leaving the EU provides us with a unique opportunity to re-examine all our procurement rules and many of our regulations. I share his passion to ensure that, as much as possible, we support our local economy and create jobs, which has never been more vital than it is today.

[Chris Stephens (Glasgow South West) (SNP)]

I want to take the Chancellor back to page 14 of his statement. He will know that DWP management have asked for 30,000 additional posts, so will the doubling of work coaches be new posts or redeployments? Will the jobcentre closure programme be suspended as a result of his announcements, and will he build an attractive terms and conditions package, given the high staff turnover in the DWP?

[Rishi Sunak]

We are investing an extra £1 billion in the DWP this year, specifically, among other things, to double the number of work coaches from 13,500. I am pleased to say that work has already started and recruitment is already under way. This will be done faster than ever before—certainly faster than in 2008-09.

[Sir Bernard Jenkin (Harwich and North Essex) (Con)]

I thank my right hon. Friend for his statement, and I add my voice to those highlighting the plight of self-employed people, or people who have been remunerating themselves through dividends and have not been able to benefit from the furlough scheme, as raised by my right hon. Friend the Chair of the Treasury Committee in a recent report, but may I thank him wholeheartedly for what he has done for the hospitality sector, which will help coastal communities such as those in Harwich and North Essex? It is a big boost for jobs and employment.

[Rishi Sunak]

I am grateful to my hon. Friend for his support. He is absolutely right. We are approaching a summer unlike any we have ever seen, and it is important that we all enjoy it safely. It will be different, but it is vital for our coastal communities and those used to welcoming visitors from home and abroad that they get to have a proper summer, and we can help collectively by eating out to help out. It is critical to remember that the 2 million people who work in these industries are particularly vulnerable and often are in areas that are not necessarily as resilient as others. They need our support so let us get out there this summer.

[Barry Gardiner (Brent North) (Lab)]

The Chancellor has made some excellent announcements, and none more so than to the hospitality sector. The prospect in his May announcement to that sector of grants of up to £25,000 delighted 9,000 hospitality businesses in my borough of Brent. That was the prospect. The reality was very different. His Department released just £3.3 million to Brent, which would have given each of those businesses no more than £366. What can he say to those 9,000 disappointed businesses, and will he back up today’s announcements with real cash this time?

[Rishi Sunak]

The hon. Member talks about real cash and business rates grants. We have deployed more than £10 billion in cash to local authorities across this country, which has found its way to 800,000-plus businesses, through grants of either £10,000 or £25,000 targeted at businesses in the retail, hospitality and leisure sector. It has been a lifeline for small shops and businesses up and down the country.

[Rachel Hopkins (Luton South) (Lab)]

I am pleased that the Chancellor has spoken about the hospitality and retail sectors, but in my constituency many of those are reliant on passengers going through Luton airport. Until there is targeted support for the aviation industry, those employees will not be supported. Many are young and from BAME backgrounds. Can I be assured that detailed equality impact assessments have been done on all aspects of the plan?

[Rishi Sunak]

I have said before that this is a matter of social justice. It is precisely because the people who work in the sectors most affected are disproportionately younger, from BAME communities and women, and on lower pay and often are part time, that we have taken bold and decisive action to help those sectors. Ultimately, we are trying to help those 2 million employed people. The hon. Member is right. It is because of the equalities impact that the moment demands such action.

[Ben Bradley (Mansfield) (Con)]

I thank my right hon. Friend for the generous support he has laid out today. It is particularly welcome for hospitality businesses, which have already been texting me their support for the packages. He will know that our country has regional inequalities, and many disadvantaged communities in the east midlands will be among the hardest hit by covid-19, while historically we have been underfunded compared with other regions. Will he help us to rebuild and have a strong local voice in this recovery by backing an east midlands authority as an effective voice for our area, to get all pistons firing on the midlands engine and rebalance things with our effective West Midlands Mayor, Andy Street, and make sure that the work he is delivering in government can be delivered effectively in the east midlands?

[Rishi Sunak]

I am loth to get involved in an east midlands-west midlands spat, but I very much encourage my hon. Friend in his efforts. He makes an important point about the importance of local leadership. It will be local leaders—town councils, parish councils, local authorities and local enterprise partnerships—who drive forward our recovery one area at a time.

[Kenny MacAskill (East Lothian) (SNP) [V]]

As others have mentioned and the Chancellor has acknowledged, the least well-off have suffered disproportionately from the health effects of the virus and must not pay the price of the economic consequences. Will he therefore ensure that the cost of these measures is borne not by the poor and low-paid, but by those with wealth and assets, whether in land and property here or in tax havens abroad, as so many chums in the Cabinet seem to have?

[Rishi Sunak]

Our record speaks for itself: this Government have done more to tackle tax evasion and avoidance than any other Government in history. We collect hundreds of billions of pounds more than has ever been collected. Indeed, I seem to recall that many of those measures were opposed by Opposition parties.

[Mrs Flick Drummond (Meon Valley) (Con)]

I thank my right hon. Friend on behalf of the many constituents in Meon Valley who have benefited from the measures he has brought in during the coronavirus crisis and who will benefit from the ones he has announced today. Will the generous new arts funding be available for those in the live events industry? If not, might further support for them be announced in the near future?

[Rishi Sunak]

The Culture Secretary is working through the detail of how the money will be distributed, so I direct my hon. Friend to him on the precise question she raises. I would say that it is important that that funding is not just for our crown-jewel assets, famous and important as they are, but will benefit the local cultural institutions in all our communities across the country.

[Yvette Cooper (Normanton, Pontefract and Castleford) (Lab)]

Having introduced the future jobs fund and the wider youth job guarantee as Work and Pensions Secretary in 2009, and having been appalled when they were cancelled a year later under the coalition, I very much welcome the reintroduction of those measures now. The Chancellor will know that speedy delivery is crucial, and the scheme will have to be bigger because the crisis is bigger. We achieved it last time by involving local councils, working with the local private sector and third sector, to deliver jobs speedily. We could do that again. Will he confirm whether this is a job or training guarantee for every young person, as we had last time? If so, from which month will the guarantee apply?

[Rishi Sunak]

The right hon. Lady knows this area well, and I enjoyed reading of and learning from some of the things she did at that time. In terms of a guarantee, what we have put in place is a comprehensive suite of interventions. She will know from the evidence that we want to encourage young people into work or some kind of work-based training. In the hierarchy of interventions, that should come first. However, we do have a classroom-based offer. She will have heard me talk about increased funding for level 2 and 3 training for school leavers especially, if they cannot avail themselves of traineeships, sector-based work academies or other interventions. More broadly, I would be very happy to sit down with her to get her advice and thoughts on how we can ensure that the kick-start scheme is as successful as it can be.

[Peter Gibson (Darlington) (Con)]

May I thank my right hon. Friend on behalf of the 9,900 furloughed workers of Darlington, whose prospects of redundancy have been reduced today, and the 1,000 unemployed young people of Darlington, whose prospects of a job have been improved today? Does he agree that his incredibly bold changes to stamp duty are the key to unlocking our housing market?

[Rishi Sunak]

I know that my hon. Friend has been working very hard on behalf of his local businesses and young people, and I am glad that he welcomes today’s initiatives. He is right about unlocking the housing market. The intervention today will mean that almost 90% of people buying a main home in this country this year and until March next year will pay no stamp duty. It is a strong catalyst for people to get moving—to get buying and selling—and, importantly, to get renovating, all of which will create local jobs in Darlington and beyond.

[Catherine West (Hornsey and Wood Green) (Lab)]

Given the emergency nature of the statement, will the Chancellor lay out exactly what kind of impact assessment will be made of each of the funding pots, so that we can ensure value for money, look at the impact of each measure on the environment and avoid any corruption or fraud?

[Rishi Sunak]

I assure the hon. Lady that all relevant impact assessments are conducted at the time that they are required by legislation. As for the environmental impact, I gave a flavour of it earlier. The sum total of the green homes grant scheme and public sector decarbonisation fund will mean that about half a megatonne of carbon will be saved every year, which is the equivalent of about 270,000 cars taken off the road, and there will be about 140,000 new jobs. I hope she will welcome that.

[Tim Loughton (East Worthing and Shoreham) (Con)]

Representing a coastal constituency, may I warmly welcome the hospitality industry measures, which are very practical? May I suggest that this should be, “Eat out, to help out, to work out”, for which we need our gyms open again?

I recognise that this is mostly about business, and I welcome the emphasis on young people, but may I ask my right hon. Friend not to forget the youngest people? Some 200,000 babies have been born during lockdown and we have seen a higher incidence of perinatal mental illness, with new parents unable to access extended family support and health visitors. What steps can he take to make sure that this cohort is helped to catch up as well?

[Rishi Sunak]

I thank my hon. Friend for that. I wholeheartedly agree with him about gyms, and have hope on that, as the Prime Minister has indicated previously that he is keen to see progress made there. On the issue of early years and children, my hon. Friend knows this better than many others—other than perhaps one colleague sitting behind me—and he is right in what he says. He will know the work we did on the troubled families programme, and I was grateful to him when I was a Local Government Minister for his advice and support on that. I know that the early years working group has put forward a range of suggestions that we can take forward into the spending review.

[Paula Barker (Liverpool, Wavertree) (Lab)]

The coronavirus pandemic has laid bare the deep and systematic inadequacies of the current social care system and revealed the true extent of the impact that underfunding, structural issues and market instability have had on the system’s ability to respond and protect older people at a time of crisis. Despite the Prime Minister seeking to flagrantly blame our incredible social care sector for excess deaths this week, when will the Government get serious about caring for our most vulnerable and fund local authorities properly to bring social care services back in-house?

[Rishi Sunak]

In our manifesto, we committed to an extra £1 billion a year for social care, and that is what we have delivered this year and will continue to deliver. During this crisis, we have provided £3.7 billion to local authorities and an additional £600 million for infection control in care homes. But as the Prime Minister has said, we remain committed to ensuring that local authorities and care homes get all the support that they need.

[Sir David Evennett (Bexleyheath and Crayford) (Con) [V]]

I welcome my right hon. Friend’s statement and all the work he has done in the past months to preserve jobs and assist our businesses. Young people are at greater risk of unemployment at this time, and I welcome his plans to help 16 to 24-year-olds with his kick-start scheme, traineeships and a better careers advice service. Does he agree that these proposals will be good for them and for our economy, and give real hope for the future, with many more jobs?

[Rishi Sunak]

I am very grateful to my right hon. Friend for his support. He is absolutely right; the research and the evidence lays bare the risk that young people face from scarring at this early stage in their careers. They are entering an appalling labour market, which is why it is crucial that we have made the interventions that we have today, particularly the kick-start scheme. He is right: if this is about one word, it is about providing them with hope.

[Mr Kevan Jones (North Durham) (Lab)]

At the beginning of this crisis, the Chancellor said that the Government would do “whatever it takes”. Local government finance is in crisis, but it was not mentioned in his statement today. Durham County Council has spent £62 million on its covid response and it has had £33.2 million from the Government, leaving £28.8 million for the taxpayer locally to pick up. When will he bring forward a comprehensive settlement for local government, which is being called for by all political parties in local government? Without it services will be lost and jobs will also be cut.

[Rishi Sunak]

As a former Local Government Minister, I know at first hand what a great job our local authorities do, but I would say to the right hon. Gentleman that the last two years’ settlements for local government have involved record increases in core spending power—

[Mr Jones]

No, they haven’t!

[Rishi Sunak]

They absolutely have—the highest in over a decade, two years in a row. In this crisis, we have provided £3.7 billion for local authorities and an additional £600 million for infection control. Just last week, at the Local Government Association conference, my right hon. Friend the Local Government Secretary unveiled a new deal with local government to help provide some compensation for the losses through income that has gone, in a sharing arrangement, and it was warmly welcomed by the sector and at the LGA.

[Mrs Maria Miller (Basingstoke) (Con)]

I thank my right hon. Friend for his statement and for so carefully judging what is needed now as we move forward, particularly to support young people who have been hard hit by recent events. Thousands of young people in my constituency got their first foot on the jobs ladder through apprenticeships at places such as the Basingstoke College of Technology. How will my right hon. Friend’s plan for jobs build confidence among employers to create and sustain more apprenticeships at this very difficult time?

[Rishi Sunak]

My right hon. Friend is absolutely right about the impact on young people. They are two and a half times more likely to work in a sector that has been closed down. She is right, and we know that apprenticeships work: the evidence points that way. What I can tell her is that, starting in September, employers will be paid £2,000 for every young apprentice that they take on, a bonus that will incentivise them to create more apprenticeships at this time of vital need.

[Darren Henry (Broxtowe) (Con)]

Alan Gerring has been an independent builder for years in my constituency of Broxtowe. I spoke to him today, and he would welcome the green homes grant as a chance to cut emissions, but also to support plumbers, builders and other self-employed microbusinesses. Does my right hon. Friend agree that now is the moment to unleash green van man?

[Rishi Sunak]

I thank my hon. Friend, and I have a feeling that might catch on, but that is exactly what we are trying to do. By our green homes grants and by stamp duty cuts, we are getting activity going, we are getting people at work, we are getting work to happen, and all of that will be good for our local communities. I know people in Broxtowe will welcome it, and I am thankful to him for coining a phrase.

[Stella Creasy (Walthamstow) (Lab/Co-op) [V]]

One word that has not been mentioned so far is childcare, yet we know that two thirds of women who want to return to work in the next couple of months cannot because they cannot get any, and that 71% of our voluntary sector childcare agencies are already operating at a loss, risking their closing in the coming weeks. So can the Chancellor set out what funding he is providing now to make sure that parents can get back to work?

[Rishi Sunak]

With regard to nurseries, for example, we have already included them in the business rates holidays for this year, and also ensured that the funding that they receive from Government remains constant throughout this crisis. On top of that, they have access to our other areas of support—bounce back loans and others—but of course we keep everything under review.

[Gareth Bacon (Orpington) (Con)]

My right hon. Friend’s support for business and workers has safeguarded the livelihoods of thousands of my constituents in Orpington. Now more than ever, it is vital that we stick to sound economic principles to help our nation’s recovery. Will my right hon. Friend therefore reject the Leader of the Opposition’s hard-left call for a raid on people’s hard-won homes and savings in the form of a new wealth tax, and offer reassurance that the Government will continue to focus instead on policies aimed at creating wealth, rather than simply plundering it?

[Rishi Sunak]

My hon. Friend is absolutely right: at this stage, that is absolutely not the policy that we should be pursuing. What we should be pursuing is policies that will get people back to work, encourage and incentivise businesses to take on new employees and new apprenticeships, and ultimately—he is right—create the wealth that funds our public services.

[Maria Eagle (Garston and Halewood) (Lab)]

Does the Chancellor agree that it makes no sense to withdraw support from businesses that are viable but cannot work at all at present, or cannot work profitably because of the ongoing effects of health restrictions, such as in aviation, aerospace manufacturing and technical production companies, all of which I have in my constituency? Furlough is going to end, but his job retention bonus will not be available to them because they cannot go back to their usual work at the moment. Will he change his one-size-fits-all approach to winding down the employment schemes that have kept many companies going in these sectors? Otherwise, he will simply have deferred a wave of mass redundancies, job losses and business failures of fundamentally sound businesses, which he could save if he makes some adjustment.

[Rishi Sunak]

There are a few remaining closed sectors, and I agree with the hon. Lady that it is absolutely right that we get those open. Indeed, the Prime Minister has said recently that that is something that he is keen to see happen, and hopefully we can make progress on that soon. With regard to the other sectors, we need to adjust to a new economy, which is why it is right that over time furlough winds down gradually and flexibly, while at the same time we reward employees generously for bringing furloughed employees back. We have also put in place a range of other interventions today to help provide hope and opportunity to young people and others across the country.

[Dr James Davies (Vale of Clwyd) (Con)]

The tourism and hospitality sector right across the UK will thoroughly welcome my right hon. Friend’s announcements today, but the sector in my constituency will benefit only if it is allowed to open, so will he endorse the call by Jim Jones, the chief executive of North Wales Tourism, for the Welsh Government to open up restaurants, pubs, cafés and indoor attractions by no later than 19 July?

[Rishi Sunak]

My hon. Friend knows well how important tourism is to Wales’s economy. In fact, it may well be more reliant on tourism than any other part of the UK, from memory, so I fully understand and sympathise with his desire to get his local tourism businesses open, ready for business and ready to ensure that we can all enjoy the summer safely in Wales.

[Sir George Howarth (Knowsley) (Lab) [V]]

In response to an earlier question, the Chancellor said that everything in the garden was rosy with local government finance, but he will know that local government faces a catastrophic loss of revenue next year as a result of covid-19, and that that will have a devastating effect on jobs and services. Knowsley Council alone faces a loss of income of £90 million, and the Liverpool city region faces a loss of £112 million, so will the Chancellor give a firm commitment that councils will receive full funding for the collection fund shortfalls in 2021 and 2022?

[Rishi Sunak]

The Local Government Secretary addressed that issue just last week and unveiled a comprehensive agreement with local government to provide loss sharing on income that has been forgone during this crisis.

[Ben Everitt (Milton Keynes North) (Con)]

Milton Keynes has a significant consumption economy, and our hospitality sector has been particularly hard hit in this global pandemic, not just in central Milton Keynes but in our market towns and, indeed, in our rural pubs. Will my right hon. Friend join me in encouraging everybody in Milton Keynes—in fact, anybody who can travel to our wonderful Milton Keynes and market towns—to eat out to help out?

[Rishi Sunak]

My hon. Friend knows well, and he has seen first-hand, what a great job his local businesses have done in ensuring that their premises are safe for us to return to. They have made an enormous effort to be able to welcome us back. With our new eat out to help out discount, we can all play our part in helping to support their businesses and to protect those jobs.

[Emma Hardy (Kingston upon Hull West and Hessle) (Lab)]

The Institute for Fiscal Studies has said that 13 universities could go bust as a result of covid-19. That will not only reduce choice and opportunity, but create unemployment and damage the local economies where they reside. Can the Chancellor state his commitment to build back better and support social mobility by confirming that no university will be allowed to collapse?

[Rishi Sunak]

My right hon. Friends the Education Secretary and the Business Secretary have already outlined proposals to engage with universities where they face difficulty. In particular, they have put in place measures to deal with the issue of fewer overseas students being here and to protect our higher education research base.

[Simon Jupp (East Devon) (Con)]

I thank my right hon. Friend for the major steps that he is taking to get money flowing through the economy in East Devon and beyond. Cutting VAT on food, accommodation and attractions to 5% has been described as “epic” by the South West Tourism Alliance. The measures announced today will protect jobs, but perhaps not my waistline, as I wholeheartedly promise to eat out to help out. Will my right hon. Friend continue to work with me and south-west MPs to protect and strengthen tourism in the best part of Britain?

[Rishi Sunak]

My North Yorkshire constituents might have something to say about that, but I know how important tourism is to my hon. Friend’s constituency, similar to so many of our rural constituencies up and down the country. I am glad that he will be doing his bit to eat out to help out. I hope that others will join him. In doing so, we can collectively help to protect 2 million jobs across our country.

[Andy Slaughter (Hammersmith) (Lab)]

While the Chancellor has made welcome announcements on the hospitality and cultural sectors, he has said nothing in support of the events industry and those who work in it, despite the Prime Minister promising a timetable for reopening last week. From wedding receptions and conferences to world-famous exhibition centres, such as Olympia in my constituency, events make a £70 billion contribution to the economy. When will safe, organised events with more than 30 people attending be permitted, as they are in most other countries?

[Rishi Sunak]

I sympathise with the hon. Member and agree that the best thing we can do to help these sectors is to get them to reopen. I know this is something that the Prime Minister and the Health Secretary are looking at as we speak. Hopefully, in the weeks to come, as we progress our fight against this virus, we can continue to reopen all the closed parts of our economy and progressively loosen some of the restrictions that currently we all face.

[Robert Halfon (Harlow) (Con) [V]]

I am over the moon with the Chancellor’s statement. He is rebuilding our apprenticeships and skills nation and ensuring that young people can climb the important ladder of opportunity—so thank you. He knows that the public sector target for apprenticeships is 2.3%. Will he consider raising the target by 5%, which would create 4,000 new apprenticeships in 2020-21, based on hiring 50,000 new members of staff in the public sector? Will he also change procurement rules to ensure that any big company bidding for a public sector contract must have at least 5% of its workforce employed as apprentices?

[Rishi Sunak]

My right hon. Friend knows this subject particularly well, so I am grateful to him for his comments. He makes two very interesting suggestions and I look forward to discussing them with him further.

[John Spellar (Warley) (Lab)]

In his reply to the right hon. Member for Wokingham (John Redwood), the Chancellor said that leaving the EU gave us the opportunity to reform our procurement regulations, so will he say exactly when he will take that opportunity and send out revised guidelines to tell Whitehall and town halls to prioritise British-based companies and British jobs? [Interruption.]

--- Later in debate ---

[Mr Speaker]

Order. Somebody’s phone is ringing. Will hon. Members just check their phones, please?

[Rishi Sunak]

The right hon. Gentleman will know that during the transition period this year we are still constrained, but he can rest assured that from next year, when we have our full freedom, we can take advantage of all these things and ensure that our local economies benefit as they should.

[Chris Grayling (Epsom and Ewell) (Con)]

I warmly welcome the Chancellor’s announcements on employment programmes. Jobs are vital going forward and this is exactly the right thing to do. I am particularly pleased to see the expansion of the sector-based work academies—one of the programmes we launched when I was Employment Minister 10 years ago. I can assure the Chancellor that we do not need to learn too many lessons from the Opposition, given our record on employment in the period up to the crisis, but I am concerned about one group on the jobs front: those in the aerospace and aviation sectors. Will he keep them firmly in mind and perhaps look at whether aviation could be included in the VAT reductions, or look at other measures to support a sector that is vital to our economy but has been very badly affected?

[Rishi Sunak]

My right hon. Friend is right about the difficulties facing the aviation and aerospace industries, and of course I will keep them very much uppermost in my mind as we go through the next few months. More generally, I pay tribute to the work that he did when he had those briefs. He knows at first hand what it takes to get unemployment down, get people into work and give them hope and opportunity. I hope that we can build on the success that he had, because we will absolutely need to deliver for our young people in the coming months.

[Caroline Lucas (Brighton, Pavilion) (Green)]

The Chancellor says he is proud of the Government’s green record, yet the green measures announced today will cut just 0.14% of UK emissions—not only that, but this is a Government who are still committed to spending £27 billion on new roads. If he wants to have a green record that he can genuinely be proud of, will he start by cancelling the roads scheme, put the money into public transport and broadband, and introduce a new rule for the UK economy to ensure that all spending and taxation is in line with the Paris agreement and restoring our natural world?

[Rishi Sunak]

It is a record to be proud of. We have cut carbon emissions by 40% in the last few years. We are now a world leader in offshore wind and, for the first time ever last year, we generated the majority of our energy from zero carbon sources. We are building on our progress. That has happened under a Conservative Government, and whether it is through our nature for climate fund, our measures to tackle air quality, or new technologies such as direct air capture or carbon capture and storage, this Government will ensure that we meet our net zero obligations and do so in a way that creates jobs in every part of our United Kingdom.

[Lucy Allan (Telford) (Con)]

I congratulate my right hon. Friend on his excellent statement and his £30 billion jobs plan, which will give hope to thousands of people in my constituency—I thank him for that. I am particularly grateful for the commitment to the future of our young people, who are hardest hit by this crisis. The kick-start scheme is for an initial six months. Will he reconsider and review it at the end of that period?

[Rishi Sunak]

I thank my hon. Friend for her support. She has spent a lot of time in this place championing the futures of young people. I am pleased to tell her that the kick-start scheme will be for longer than six months. It will be open for bidding, hopefully, at the end of this month or the beginning of next month, and the first new kick-starters will start in the autumn. The scheme will run at least until the end of next year. Hopefully, if it is popular, we can get as many as hundreds of thousands of young people being part of the kick-start programme. I hope that she and her constituency can be a champion for it.

[Stephen Flynn (Aberdeen South) (SNP)]

Three hundred and fifty billion pounds: that is how much the UK Treasury has coined from Scotland’s oil and gas sector over the past decade, so I say to the Chancellor that it is time to give back. When will his Government finally stop dithering and instead deliver on an oil and gas sector deal to protect jobs now while creating new and sustainable jobs for Aberdeen’s future?

[Rishi Sunak]

Scotland has benefited extraordinarily from the interventions that this Government have put in place during this crisis. I talked earlier about the Barnett consequentials and the billions of pounds, but more importantly about the ability for us to act as one United Kingdom. At a time like this, the importance of that has never been more to the fore. The hon. Gentleman talks about oil and gas. I am happy to acknowledge the difficulties in that sector, and I know that the Business Secretary is in talks with it. Mechanisms have been put in place before. Again, we keep all these things under review, and if we need to make more interventions in future, of course we will.

[Bim Afolami (Hitchin and Harpenden) (Con)]

I thank the Chancellor for his statement and also for his kind words that he is considering my proposals on recapitalising the SME sector. I want to ask about the infrastructure funding of, I think, £5.6 billion that he has committed to today. Will he expand on how he thinks we can get infrastructure delivered more quickly, whether it is through dealing with planning regulations or other practical obstacles, because that is how we can make sure that that money is most effective?

[Rishi Sunak]

My hon. Friend is absolutely right. It is one thing to sit here and approve budgets for things; it is more important that we get on and actually deliver them. We need to make sure that our communities see tangible improvements in what is happening around them, and, particularly given the economic situation we face at the moment, there is a premium on doing that quickly. That is why we brought forward £5 billion-worth of projects and why we have initiated Project Speed to look at our entire process end to end—procurement, planning, construction and regulations approval—to ensure that we can deliver for our communities as quickly as possible.

[Beth Winter (Cynon Valley) (Lab) [V]]

Richard Murphy, a professor of political economy at City University in London, says that the Government have the potential to raise £174 billion a year if wealth was taxed at the same rate as income. That could cover the cost of the job retention scheme for over 12 months, according to the latest estimates from the Office for Budget Responsibility. Does the Chancellor believe that the time is right for a radical overhaul of our taxation system in order to fulfil the Prime Minister’s levelling-up promise, or is the truth that we are not really “all in this together”?

[Rishi Sunak]

No, I do not believe that now is the time, or ever would be the time, for a wealth tax. Now is the time to recognise the acute challenge that we face of unemployment and now is the time to act decisively and with compassion to provide hope and opportunity to the hundreds of thousands of young people, especially, who are at risk of scarring and losing the future that they deserve. That is why we have put in place the measures today, and that is what the focus should be on.

[Andrew Jones (Harrogate and Knaresborough) (Con)]

I congratulate my right hon. Friend on his statement. Young people are perhaps more at risk from the economic impact of coronavirus, so I was very pleased to see the introduction of the kick-start programme. Does he agree that a comprehensive package of support for apprenticeships and traineeships, and other support too, will allow young people to acquire the skills they need to take the opportunities of the future?

[Rishi Sunak]

My hon. Friend is absolutely right. We cannot afford to lose this generation; they cannot be the generation that is defined and scarred by coronavirus. That is why, as he rightly identifies, we have put in place a suite of interventions, from traineeships to apprenticeships to the kick-start fund, all designed to help that generation to a better and a brighter future.

[Jessica Morden (Newport East) (Lab) [V]]

According to StepChange Debt Charity, 4.5 million people have lost income and accumulated £6 billion of debt in arrears on household bills during the pandemic. Will the Chancellor ensure that economic recovery plans also include a strategy to support people in unavoidable coronavirus-related financial difficulties?

[Rishi Sunak]

I know my colleague the Financial Secretary has been abreast of this issue for a while, and he has just reminded me that we have invested £37 million in debt advisory services during this time. I also know that he is taking forward actions on our breathing space initiative, which is something that he passionately believes in, and I wholeheartedly support those efforts.

[Richard Fuller (North East Bedfordshire) (Con)]

The Chancellor has answered many specific questions, but I would like to commend the overall tone of his statement, which he began by saying that he would be “unencumbered by dogma”, but with

“a simple desire to do what is right.”

His responses have oftentimes mentioned the social justice imperative behind his plan for jobs, which I think will strike many in the country as absolutely right.

May I echo the comments of my right hon. Friend the Member for Bromsgrove (Sajid Javid), about the need, when we come to the fall, to look at ways in which overall debt as a burden on the GDP of the country can be brought under control?

--- Later in debate ---

[Rishi Sunak]

I am very grateful to my hon. Friend for those comments, and he is absolutely right about how I have approached this. As I have said, for me, it is a question not just of economics but of values, and we demonstrate those through the actions we take and the people that we prioritise. He is also right to highlight the importance of sustainability in our public finances, which he knows I passionately care about and have spoken about repeatedly from these Benches. He can rest assured that as we come to the autumn, we will set our public finances on a path back to sustainability.

[Darren Jones (Bristol North West) (Lab)]

The Chancellor failed today to set out sector-specific help for British manufacturers. In doing so, he is gambling with an important industry and making the UK less competitive compared with countries such as Germany, France and the United States. Perhaps the Chancellor can set out for the House today what it is that he has against British workers making British aeroplanes, British cars and British steel?

[Rishi Sunak]

I am not entirely sure about the tone of the hon. Member’s question. The support schemes we have put in place have benefited equally all sectors and all workers in every region and part of our United Kingdom. Manufacturing companies have been large users of the furlough scheme and are very grateful for it. They are now in the process of bringing those workers back and adding shifts, and they are grateful also for the flexibility that that scheme provides. What they are more interested in when I speak to them are our ambitious commitments, such as our plans to double research and development investment. We will be working closely with the private sector to do that, helping create the innovations that will drive growth, productivity and employment tomorrow.

[Andrea Leadsom (South Northamptonshire) (Con)]

My right hon. Friend is doing a fantastic job in promoting and protecting jobs, but to really trade our way out of this recession, we will need to look at the future, and I know he is keen as I am to see a green recovery. Does he agree that COP26 next year offers us a really good opportunity to show UK global leadership, including by working now with international partners in big projects in areas such as battery storage, offshore wind or carbon capture, usage and storage? Those areas can create green jobs for the future the Chancellor.

[Rishi Sunak]

My right hon. Friend knows this area better than most. She is absolutely right. This is an opportunity for us to demonstrate global leadership, and she can rest assured that we will do so, particularly on the finance track, which I am responsible for. I am working closely with Mark Carney, who is the Prime Minister’s envoy, and we are trying to put in place an ambitious set of goals that we can help deliver. She also talked about our leadership in particular areas, and those are things that we must double-down on. With offshore wind and carbon capture and storage, we can lead the world in developing those technologies.

[Brendan O'Hara (Argyll and Bute) (SNP) [V]]

Although I welcome the temporary reduction in VAT, it does not go nearly far enough to help the tourism and hospitality businesses in my already economically fragile Argyll and Bute constituency. Surely to ensure that these otherwise robust businesses are still there and are ready to go again next year, they need an extension of furlough to be able to retain their staff and to have access to grants, rather than having to rely on the business interruption loan scheme.

[Rishi Sunak]

I will not repeat my comments on an ever-extending furlough scheme. I do not think that that is the right thing to do. With regard to grants, we provided grants—£10,000 or £25,000—specifically to businesses in the retail, hospitality and tourism sector, and that is why those businesses did not necessarily have to use loans if they did not want to. They received that support early in this crisis, because we acknowledged the particular difficulty that they would face. The hon. Gentleman referred to the VAT cut, which was one of the significant asks—if not the significant ask—from industry, but there is also the “eat out to help out” discount that will drive tons of businesses and protect millions of jobs.

[Sir Graham Brady (Altrincham and Sale West) (Con)]

The Chancellor spoke about finding a new balance between safety and normality. Is it not time to look at moving away from the guidance that people should work from home if possible towards guidance that they should go to work if it is safe to do so? May I also urge him to reflect over the summer on whether a cut or suspension of air passenger duty would be the best way to get the aviation sector back to health for next year?

[Rishi Sunak]

My hon. Friend, as always, champions the aviation industry. He is right to do so, and, as he knows, we are committed to a review of aerospace taxation, so I will certainly bear that in mind. With regard to the guidance, I share with him an impatience to get our lives back to normal. I know what a difference it will make, not just to those businesses, but to all the ancillary businesses that are used to office workers being in their offices. That is something that we should hopefully look to address in the coming weeks and months as we progressively move back to a new normal.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

Having campaigned for many years for a 5% rate of VAT for the visitor economy, may I welcome that part of the Chancellor’s announcement today? May I ask him, though, please not to close the door on the idea of extending that or even making it permanent? He will have the best possible data now to test against previous studies that have shown that that rate could actually bring a better return of revenue for the Treasury. I fear that, even for my constituency where we have a highly seasonal visitor economy, many of the businesses will not benefit from it, because they are not intending to reopen again until next spring.

[Rishi Sunak]

I know that this will make a big difference. It is important though that it is time limited. That is in keeping with most other countries that have done something similar—they have also run theirs through to the end of the year. I will happily bear all future tax suggestions in mind, but, in the short term, I hope that the right hon. Gentleman’s constituents and businesses get the boost in confidence and demand that they will need.

[Anthony Browne (South Cambridgeshire) (Con)]

It is bold, it is imaginative, and it is well-targeted. I congratulate my right hon. Friend the Chancellor on this package, which will do so much to promote jobs and growth across the country. I very much welcome the cut in VAT and in stamp duty, but most welcome of all is the kick-start scheme, which brings hope to young people in these difficult times. Unlike Labour’s future jobs fund, it is not just focused on the public sector. Does he agree that it will have most impact if it is fully embraced by the private sector, and private businesses take advantage of the opportunity to take on young workers?

[Rishi Sunak]

My hon. Friend is absolutely right. It is important that we provide as many opportunities for young people as possible. One thing we want to improve and build on is the involvement of the private sector. I hope that this becomes a galvanising cry to businesses, small and large, up and down the country to take on a kick-starter to help play their part in the recovery, and I know that this is an area in which he has strong experience from his time in London. I appreciate the advice and suggestions that he has given me about how to encourage and incentivise businesses to create jobs and opportunity.

[Ian Paisley (North Antrim) (DUP)]

May I take the opportunity to say thank you, Chancellor? I am already receiving text messages from my constituents— from the business community and from ordinary men and women—saying thank you to the Chancellor for some of the measures that have been announced today. So, thank you, Sir. It is a very important statement that you have made and it will benefit many of my constituents. Last week, the Prime Minister told us from the Dispatch Box that the Government were going to invest massively in hydrogen power. The Chancellor had me on tenterhooks. I was waiting for the statement. I was waiting for him to tell me that the new hydrogen strategy is about to be announced. It has not come, so he still has me on tenterhooks. Will he now commit solidly, on behalf of the Government and of the Treasury, to unlock that strategy that will unlock £1.5 billion of investment money in the whole of the United Kingdom. Invest billions of pounds into this new strategy and that will allow us to commit, as a nation, to this new, clean, green technology? Will the Chancellor meet me and colleagues—

--- Later in debate ---

[Mr Speaker]

No, not thank you. You are going to stay on those tenterhooks. You will be on them for a long time if you do that again. [Laughter.]

[Rishi Sunak]

I am grateful to the hon. Gentleman for his very kind words. I am glad it will make a difference to his constituents, as I hope it will to communities up and down the country across our United Kingdom. On hydrogen, what I can say is that I am absolutely not in a position to steal my boss’s thunder, so I will leave future announcements on hydrogen to him. The hon. Gentleman can rest assured that it is something that the Prime Minister and I—and, indeed, the Treasury—take very seriously.

[Marco Longhi (Dudley North) (Con)]

I will be brief. Last week, my right hon. Friend the Prime Minister accepted my pleading to come and visit Dudley. He delivered a visionary speech and saw for himself the building of the institute of technology that will futureproof people for the jobs of the future. Will my right hon. Friend the Chancellor please also visit Dudley to support that scheme, as well as our ambition for a university campus, as I want Dudley people to be jobs-ready?

[Rishi Sunak]

I am very happy to accept my hon. Friend’s invitation. He is absolutely right. The best way for us to provide opportunity for people is to give them the skills and the education they need, whether through universities, institutes of technology, further education, schools or apprenticeships. Providing people with that knowledge is what will enable them to build a better future for their lives. That is something that he and I both feel very passionately about. We will, as a Government, deliver that.

[Seema Malhotra (Feltham and Heston) (Lab/Co-op) [V]]

I am genuinely surprised that the Chancellor has not today brought forward a flexible furlough scheme for aviation, which he knows will have a longer recovery tail. I hope that, as he keeps in touch with the industry, he will also keep in touch with MPs from aviation communities for place-based support. He is right that young people and others will need support and access to jobs, and I welcome the kick-start scheme. However, with experts estimating that over 30,000 work coaches are needed and unemployment in the sector set to hit a record high in October, the Secretary of State for Work and Pensions expects 4,500 new work coaches to be in place by then. Is the Chancellor concerned that there will not be enough in place to meet demand when we most need it, and what more does he think can be done?

[Rishi Sunak]

I commend and applaud all the efforts the Work and Pensions Secretary and her team are doing at the moment. Just for reference, they are doubling the number of work coaches and doing it in record time. We will have 13,500 in just eight months—a 100% increase. It is worth comparing that to what happened in 2008-09, when the Department for Work and Pensions recruited just 10,000, a 60% increase, which took 12 months. We will go as fast as is necessary, but no one can accuse us of not doing as much as we can, as quickly as we can, to provide people with the support that they need.

[Stephen Crabb (Preseli Pembrokeshire) (Con)]

Make no mistake, what the Chancellor has announced today to save a generation of young people from bearing the brunt of this economic crisis is incredibly positive and to be welcomed. May I welcome, in particular, the determination of my right hon. Friend to avoid past mistakes in employment schemes, where we saw too many examples of young people in work placements not doing meaningful work, with poor oversight, poor management and no opportunity to really build their skill levels? Make this scheme, the kick-start scheme, the best employment support scheme we have ever seen.

[Rishi Sunak]

I very much thank my right hon. Friend for that support. Of course, this is an area he will know well. He is absolutely right. There is no point in doing this if the work placements are of low quality. It is important that we get it right as we construct the bidding process. I would be very grateful to him if he sat down with me so that we can get his thoughts on how best to achieve that.

[Barbara Keeley (Worsley and Eccles South) (Lab) [V]]

I join my hon. Friend the shadow Chancellor in urging an end to poverty pay for our care workers. Today’s interventions in the job market are welcome, but there is still no recognition in pay for the fantastic job done in this crisis by our care staff. Rather than blaming care staff, as the Government have done this week, will the Chancellor commit to showing them some parity of esteem with NHS staff and pay them a real living wage of £10 an hour?

[Rishi Sunak]

I join my colleagues in paying enormous tribute to those on the frontline during this crisis, who have done an extraordinary job under incredibly difficult circumstances. They deserve not just our thanks, but our praise, and they have it. In terms of public sector pay we are in the midst of the second year of inflation-busting pay rises for almost a million people, and we have got social care who are funded from local authorities. As I said, local government has enjoyed two years of record increases in core spending power, which hopefully will help find its way to the frontline.

[Sir Christopher Chope (Christchurch) (Con)]

May I make a suggestion to my right hon. Friend of one way in which he could help fund some of today’s expenditure commitments? That is to implement without further delay the cap on public sector exit payments. My right hon. Friend the Chief Secretary to the Treasury promised on 13 March that that would be done by bringing forward secondary legislation before the summer recess. That has not happened. Can my right hon. Friend therefore allay concerns that the process is being sabotaged by Treasury mandarins—the Sir Humphreys—who have for five years successfully resisted this proposal, which was supported by the House in legislation five years ago?

[Rishi Sunak]

I remember that when I had the Chief Secretary’s job we discussed this very topic, and my hon. Friend is right to keep highlighting it. What I can tell him is that, as the Chief Secretary said, I believe, very recently, we are well on the way to implementing the measure and will bring forward appropriate legislation in due course.

[Hilary Benn (Leeds Central) (Lab)]

Given that councils have a statutory responsibility to set a balanced annual budget, even the further help announced last week will not be enough for councils like Leeds and many others. I urge the Chancellor to look again at what the Treasury can do to help fill the remaining gap, which in the case of Leeds is £63 million, because without further assistance the council will, by law, have to start cutting jobs, and those could include non-statutory services that have been so important in providing support to communities affected by covid.

[Rishi Sunak]

The right hon. Member is right to highlight the important work that Leeds council does. Having spent some time there, seeing how they do early intervention in children’s services in particular, I was very impressed when I did the local government job. My right hon. Friend, the Secretary of State for Housing, Communities and Local Government has been engaging extensively with the sector. We have put billions of pounds of incremental support in place. Of course it was going to be difficult—it is difficult for all of us, whether it is business or a local authority—to get through this time, but considerable support has been put in place. In particularly, the announcement last week on a loss-sharing arrangement with central Government for their income and fees and charges is an important step in the right direction.

[Dr Kieran Mullan (Crewe and Nantwich) (Con)]

I thank my right hon. Friend for the steps he has announced today, particularly focused on young people, which show yet again that the Conservatives do what works, not just what might sound good, even if it means tough decisions in the short term. Can he confirm that from the support given so far, proportionately the lowest-income families in our society have benefited the most?

[Rishi Sunak]

My hon. Friend is absolutely right. The analysis published today shows that we have reduced the scale of losses for working households by up to two-thirds in general, but the support for the poorest households has been the highest. He will find that in the distributional analysis published today. It demonstrates what we believe is important at a time like this—to protect the most vulnerable in our society. I know that is something that he feels very deeply, and I share that feeling.

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

The country expects us to pull together now to get our country back on its feet. In that spirit, let me welcome the investment that the Chancellor has announced today for young people and for the hospitality trade. My observation, though, is that of the money he has brought forward, the capital is only about 5% to 6% of the budget that he has earmarked for the next four or five years. What that means in my region is 50p per person per week invested in so-called shovel-ready projects. That is not enough.

But crucially, there is a gaping hole in today’s announcement where support for manufacturing should be. We have 330,000 people across the west midlands on furlough in construction, manufacturing and the car business. I believe that the sharp ends to the furlough arrangements will put many people out of work, and there is no subsidy scheme for new cars of the type that has been announced in France and Germany. We want to be the capital of green manufacturing. I fear that, from today, we are now looking at manufacturing meltdown.

[Rishi Sunak]

When it comes to capital investment, it is important to put in context what our existing budgets were for this year. I announced £88 billion at the Budget for this year. That represents a 20% increase on our capital investment plans in the previous year and, as a percentage of GDP, the highest amount that we have invested in capital since the ’70s. The starting base level for our capital investment is already exceptionally high. We have brought £5 billion of additional projects forward into this year, but, taken in the round, it will be the most we have ever spent on capital in real terms for a very, very long time.

[Sir Edward Leigh (Gainsborough) (Con)]

Will this young, vigorous Chancellor not be too cruel to an old Thatcherite for making this deeply unfashionable point? There are no good, long-term subsidised jobs. As we saw with the new Labour make-work jobs and with furlough, sooner or later they are subject to fraud and market distortion. Will he confirm that the only good, long-term jobs are based on the Government ensuring deregulation, market flexibility and tax cuts on entrepreneurship, with a plan to repay the national debt? Otherwise, as the right hon. Member for Birmingham, Hodge Hill (Liam Byrne) once said, there will be no more money.

[Rishi Sunak]

I wholeheartedly agree with my right hon. Friend. He is absolutely right: these interventions are specific to the moment that we face now. They provide support for young people at this moment of acute crisis. In the long term, only a dynamic market economy can provide sustainable, long-term employment for young people and beyond. In the medium term, once we get through this crisis, we must return our public finances to a sustainable place.

[Margaret Ferrier (Rutherglen and Hamilton West) (SNP) [V]]

The community access to cash scheme recently announced at Cambuslang in my constituency is going to become one of the pilot areas, bringing back much needed payment facilities to our community, which has lost several bank branches. The Chancellor has promised legislation to improve access to cash, which is needed urgently in the light of the economic downturn caused by the coronavirus. When will he bring forward that vital legislation to protect cash use, support small business and boost the recovery of our high streets?

[Rishi Sunak]

The hon. Member makes a good and fair point about the importance of cash, particularly in our rural communities. My hon. Friend the Economic Secretary is very much on top of this. He is conducting roundtables with the industry in the coming weeks, and we will bring forward legislation, as we have committed to do.

[Steve Brine (Winchester) (Con)]

I thank the Chancellor for bringing some real hope today. Early years providers have played their part in getting us through this pandemic, but reduced attendance combined with increased costs is taking its toll. That is on top of the fact that, as he and I have discussed before, this sector is struggling and has been experiencing market failure for quite a long time. Jobs, jobs, jobs is fantastic and right, but it has to be backed by childcare that actually exists. Will he give me some time—it only has to be a short amount; 15 minutes would be fantastic—so that we can set out the challenge this sector faces and some of our suggested solutions?

[Rishi Sunak]

I know that this matter is close to my hon. Friend’s heart, and he has brought it up with me before. I would be delighted to give him the time he asks for to discuss this matter further.

[Justin Madders (Ellesmere Port and Neston) (Lab)]

Last week Airbus announced that 1,700 jobs are going in this country. It cannot afford to wait for a bonus payment in January, so what is the Chancellor going to do to save those jobs now?

[Rishi Sunak]

I have been very clear: I cannot save every single job. It is a tragic fact that what we have done to our economy over the past few months means that there will be job losses. Unemployment will rise. It is something that we cannot avoid, but what we can do is put in place a range of interventions to provide new hope and new opportunity for those who lose their jobs, so that they can find the skills, work placements or new jobs they need to provide a better future for themselves and their family. That is what we will devote all our energies to in the coming weeks and months.

[Mary Robinson (Cheadle) (Con)]

I am grateful to the Chancellor for this statement and the enormous package of money that is being put into our constituencies and the economy. I am keen to see even more money made available for us to spend on the things that really matter in the UK. One way to do that is to cut down on fraud and corruption. As chair of the all-party parliamentary group on whistleblowing, I am very keen that we do that. Will he join me for our webinar tomorrow, when we will be looking at ways that international Governments are tackling this through programmes, so that we can deal with the problem of corruption and fraud? I thank him for everything that he has done on tackling furlough fraud, which has been a real issue in our economy.

[Rishi Sunak]

I pay tribute to the work my hon. Friend does in this area. She is absolutely right that we must tackle corruption and fraud in procurement. It costs billions, if not tens of billions, of pounds; that is money lost to the Exchequer that we can use to fund public services, and it also means that our local authorities in particular do not get the quality of services that they need to provide for their residents. My hon. Friend is absolutely right to focus on this, and I very much look forward to hearing what proposals she might have for us to take forward.

[Claire Hanna (Belfast South) (SDLP) [V]]

I thank the Chancellor for advancing some very important mechanisms, although I share the concerns of others about those who have fallen through the cracks, such as new freelancers and those on precarious contracts. Given the need to protect confidence in spending, and given the opportunity that historically low interest base rates hold, will the Chancellor consider speaking to the banks, particularly those in which the Government have a majority stake, about offering temporary lower-cost mortgage products, as that could save hundreds of pounds for the average household? Will he be open to meeting me to discuss this idea?

[Rishi Sunak]

My hon. Friend the Economic Secretary is in close contact with the banking sector and deserves enormous credit for the measures he has put in place to provide forbearance to people during this difficult time, and he will be very happy to meet the hon. Lady. He put in place a scheme that provided mortgage holidays to people, and I think about one in six mortgages was able to benefit from that. Millions of people will therefore have welcomed that relief, and I pay tribute to him for the excellent work he has done.

[Martin Vickers (Cleethorpes) (Con)]

Having question 74, it is difficult to think of something that has not been mentioned yet, but it is a fair bet that up until now no one has quoted the Grimsby Telegraph, which last week said, after the Prime Minister’s speech:

“Now put your money where your mouth is Boris!”

The Chancellor has delivered on that today. The article finished by saying:

“Give us the opportunity and we’ll show the country what can be achieved”,

and the support given to businesses today will verify that.

May I also urge the Chancellor to consider yet again the freeport issue for Immingham and Grimsby? The consultation ends next week. Please do not waste time mulling over the consultation responses; deliver freeport status for Immingham and Grimsby.

[Rishi Sunak]

My hon. Friend is right, as always, about the importance of private enterprise in driving our growth forward. He is right to highlight a freeport. I know what a difference it would make to his community; I remember that when I met his local businesses they were hungry to take up that opportunity to attract investment, to create new jobs, and to drive up productivity, and I look forward to working with him in the coming months on trying to make that a reality.

[Clive Efford (Eltham) (Lab)]

A nine-month cut to stamp duty is welcome, but without an injection of new houses it risks forcing up prices, making it harder, not easier, for first-time buyers to buy homes. This statement should have been taken as an opportunity to inject capital into the housing market, and also into social housing, building houses that people can afford to live in, and creating opportunities for new jobs, new apprenticeships and new skills that people can use in the future, so will the Chancellor go away and have a look at putting some money particularly into building social housing?

[Rishi Sunak]

The good news is that we already have. The Prime Minister announced it, and I talked about it at the Budget: the affordable homes programme will increase from £9 billion to £12 billion over the next few years, a significant uplift in the amount of new housing delivery—180,000 new homes, from memory. With regard to the benefits of stamp duty, the evidence we have both from economists and HMRC is that the majority of the benefit of a stamp duty cut last time around, in ’08-’09, accrued to the buyers.

[Steve Double (St Austell and Newquay) (Con)]

As the chairman of the all-party group on hospitality and tourism, I warmly thank the Chancellor for his announcements today: thank you for listening to the sector and for what you have delivered, which will undoubtedly save tens of thousands of jobs and thousands of businesses. The Chancellor has done his bit, and businesses across the country have done theirs in getting ready to make our bars, pubs, restaurants and hotels safe to welcome customers. Does he share my view that what we now need is the British people to do their bit—to get out and spend money in our bars and restaurants—and will he join me in inviting everyone to come to Cornwall this summer?

[Mr Speaker]

Let’s hope there’s sun in August.

[Rishi Sunak]

There are fewer greater champions of the tourism and hospitality industry than my hon. Friend, and I know he will be pleased about today’s announcements. He is absolutely right that our local businesses in all our constituencies have worked unbelievably hard over the past few weeks to adapt how they do business, to invest in new things, and to make their premises safe for us, and that is why today we introduced the “eat out to help out” discount. We can all play our part in supporting these businesses and protecting these jobs.

[Stephen Farry (North Down) (Alliance)]

As a former employment Minister in Northern Ireland, I welcome the Barnett consequentials that allow us to shape our own local response around youth unemployment, apprenticeships and traineeships, but what analysis has the Treasury done of where redundancies have been occurring and where they are likely to occur over the coming months? Surely that information should guide the use of that £9 billion for the furlough bonus to be more targeted around those sectors that are going to face problems for longer, but which have sustainable futures, such as aerospace and the creative industries.

[Rishi Sunak]

We have published breakdowns of the furlough population by region, constituency and age to give a sense of the types of people who are affected. One thing that comes out of that is the importance of rural and coastal communities being particularly impacted by numbers of people on furlough. That is because they are disproportionately reliant on the hospitality and tourism sectors, which is why today’s interventions are targeted and will make the biggest difference to the greatest number of people.

[Daniel Kawczynski (Shrewsbury and Atcham) (Con)]

In addition to the misery that covid has brought to our constituencies, over 46 constituencies, such as mine on the River Severn, also face devastation from flooding earlier this year—a double whammy for our local businesses. The River Severn Partnership has been formed in conjunction with all the councils down the River Severn and the support of local MPs. I have been led to believe by the Environment Agency that an announcement is imminent on additional support for the River Severn Partnership in order to secure a more holistic solution to the management of this river. Does the Chancellor agree that when it comes to the recovery of our economy, making sure that our constituencies are not repeatedly flooded is an important aspect of that? I very much hope so.

[Rishi Sunak]

My hon. Friend is absolutely right. That is something the Committee on Climate Change also mentioned, which is why in the Budget we doubled the investment that we put into flood defences. That was the right thing to do. It will build resilience in our communities and protect our natural environment. I do not know the specifics of the timing of the announcement that he alludes to, but I am happy to go away and take a look at it. I know how important it is to him and his constituents that we are able to protect them from the devastating flooding that we have seen in recent years.

[Vicky Foxcroft (Lewisham, Deptford) (Lab) [V]]

Disabled people and charities are concerned about the lack of support available to enable high-risk individuals to return to work safely when the shielding programme ends. Ministers have said they expect employers to do the right thing and ensure that workplaces are covid secure. Where it is impossible for an employer to do this, individuals could be forced to put their health at risk just to make ends meet. Will the Government consider extending the full job retention scheme for those who are not able to return to work safely?

[Rishi Sunak]

Based on the medical advice, it has been determined that the shielding population can return to work safely after the end of the month. That is already clear and has been announced. We have published extensive guidance and guidelines for workplaces to make them safe, so people can take comfort from that. If there are more things that we need to do, I am sure the hon. Lady will send them to the Business Secretary for the workplaces, or indeed to me, and we will happily take a look at them.

[Richard Drax (South Dorset) (Con)]

On behalf of the many businesses in South Dorset, may I thank my right hon. Friend for the furlough scheme and welcome his statement today? Surely our aim is to help many in a struggling private sector because, as I am sure he agrees and as the Opposition need continually to be reminded, it is they who generate the jobs and prosperity that we need, as well as the tax that pays for our public services.

[Rishi Sunak]

My hon. Friend is absolutely right. It is, in the long term, the market economy that will provide the growth and prosperity we need. It will provide the jobs that we need, but it is important that we provide support to those businesses in the short term, given the disruption they have faced, and I know his local businesses and many others will welcome the jobs retention bonus to help reward and incentivise them to do the right thing, stand by their workers at this time and bring them back, and look forward to a brighter future.

[James Murray (Ealing North) (Lab/Co-op) [V]]

On 25 June, a Treasury direction in relation to the coronavirus job retention scheme made it clear:

“Integral to the purpose of the CJRS”

is that the grant

“is used by the employer to continue the employment of employees”.

Will the Chancellor therefore confirm that British Airways would be liable to pay back any taxpayers’ money used to furlough staff the company chose to put on notice of redundancy during that furlough period?

[Rishi Sunak]

Procedures are in place for any employee to talk to HMRC if they believe that they themselves have been the victim of fraud or that the company for which they work has not acted in a way in keeping with the guidance. I urge any employees of any company who feel that that has happened to take up the matter via the HMRC hotline, the details of which are online.

[John Penrose (Weston-super-Mare) (Con)]

First, I thank the Chancellor for, as far as I can work out, subsidising me to go down the pub; that is very welcome indeed. I also thank him for the effect that his announcement about tourism VAT will have on hundreds of businesses and thousands of jobs in my constituency of Weston-Super-Mare. May I suggest to him that over the medium term, the best guarantee of jobs and employment has to be to have competitive businesses? I therefore urge him to consider, over the more medium term, sharpening our competition laws and opening up our market economy to tougher competition, as the best long-term guarantee of employment for everybody.

--- Later in debate ---

[Rishi Sunak]

My hon. Friend is absolutely right. Just to clarify: the “eat out to help out” discount will not apply to alcohol, but 90-something per cent. of pubs serve food, so my hon. Friend can still go to the pub and enjoy that. He is absolutely right about competition policy: it is important that we have dynamic markets in this country. We need dynamic competition to create jobs and productivity in order to get the outcomes that we want. I am happy to talk to him—I know he has expertise in this policy area—to get his thoughts about things we can do to update and turbo-charge our competition policy to make sure it is fit, especially for the digital age.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP) [V]]

The Chancellor said at the beginning of his statement that

“no one will be left without hope”,

so what does he say to the hundreds of thousands of businesses and sole traders excluded from support during this pandemic crisis? Many of them are in seasonal businesses facing, in effect, three winters of trading. They cannot afford extra debt, so is now not the time to convert some of the money put aside for loans into grants to support the sector?

[Rishi Sunak]

The hon. Gentleman talks about seasonal businesses and whether they have or have not had support; he may have missed the fact that we have just cut VAT for those sectors from 20% to 5% for the next six months, and we have just provided an “eat out to help out” discount for the country to enjoy discounted meals to protect those businesses and protect the employment in them. That is probably the best thing we can do for seasonal businesses.

[Mr Steve Baker (Wycombe) (Con)]

With his plan for jobs, my right hon. Friend has, like Roosevelt, given a masterclass in economic interventionism, but it is quite expensive. Can he reassure me that he has a contingency in case the independent Bank of England needs to change its stance on monetary policy because inflation begins to rise?

[Rishi Sunak]

As ever, my hon. Friend is right to remind us about the importance of monetary economics, and he is also right to focus on the long-term sustainability of our public finances. Although in the short term it is right to act in this way to prevent long-term damage and scarring to our economy that would create an ongoing, larger structural deficit, once we get through this crisis we must retain and sustain public finances. We will return them to a position of sustainability over the medium term, I assure my hon. Friend of that, but in the short term I am confident that this is the right thing to do to protect the long-term health of our economy.

[James Daly (Bury North) (Con)]

As the chair of the all-party group on youth employment, I warmly welcome the fantastic package of support for young people in our country that the Chancellor announced today. Bury College in my constituency has a proven record of delivering sector-based work academies, with 600 young people currently in construction and engineering placements. Will the Chancellor meet me and the fantastic principal, Charlie Deane, to discuss how Bury College can expand the range and number of placements on offer for young people and thereby transform their opportunities in the jobs market?

--- Later in debate ---

[Rishi Sunak]

I am excited to hear about what is going on at Bury College. My hon. Friend is absolutely right about the importance of youth employment—a subject area that he knows well. The Secretary of State for Work and Pensions would probably be delighted to sit down with my hon. Friend, as we announced today our tripling of sector-based work academies, and make sure that we can figure out how as many of them as possible can find their way to his constituency.

[Kerry McCarthy (Bristol East) (Lab)]

My colleagues have mentioned the lack of sector-specific support in this statement. May I ask particularly about car manufacturing? France has announced increases to electric vehicle subsidies, making them the most generous in Europe, and a means-tested scrappage scheme. Germany has doubled its EV subsidies. What will the Chancellor do to not only get car manufacturing back on its feet, but to help us meet our climate objective and the Committee on Climate Change recommendation that we bring forward the ban on new diesel and petrol vehicle sales to 2032—the committee recommends a zero-emission vehicle mandate? I hear nothing from him on what he will do to support manufacturing and our climate objectives.

[Rishi Sunak]

At Budget, we announced about £1 billion in support for low-emission vehicles in various different ways, including a £400-million charging infrastructure fund to spread the development of charge points across the country. I think that underlines our commitment to ensure that we transition properly to our net zero environment, starting with our transportation industry.

[James Sunderland (Bracknell) (Con)]

It strikes me that this is a perfect opportunity to review our investment and procurement strategies in a range of sectors. Does the Chancellor agree that we must stop spending so much taxpayers’ money overseas? It is time to build British, buy British and sell British.

[Rishi Sunak]

My hon. Friend is right to point out the opportunities that we will now have, after leaving the EU, to tweak our procurement rules to ensure that we will of course always get value for money for the taxpayer, and that we can do so in a way that supports our local economies and—especially right now—local jobs.

[Wendy Chamberlain (North East Fife) (LD)]

Although it has and still does exclude many people, it must be acknowledged that support delivered directly via the Treasury, such as the jobs retention scheme, has been delivered quickly. That support is allocated on the basis not of proportion of population, the cost of support or the level of productivity, but on the need of those who apply and qualify. This is how devolution can operate. Will the Chancellor provide us with detailed figures so that we can assess exactly how much financial support has been delivered from the Treasury to the people and businesses in Scotland and the other devolved nations?

[Rishi Sunak]

Those numbers have been published. As I said, £4.6 billion is the total amount of Barnett funding that has been provided to Scotland throughout the crisis. The block grant adjustment resulting from the stamp duty cut will be finalised after we have final costings from the OBR.

[Sir Desmond Swayne (New Forest West) (Con)]

After that package and that performance, the only reasonable thing I can say to my right hon. Friend is, “Remember, O Caesar, you are mortal.” However, it would be a great shame if the effectiveness of his measures were to be undermined in the New Forest, with the loss of at least £16 million to local traders, by the company to whom the Forestry Commission handed a monopoly refusing to open its campsites. Will he summon Forestry England, threaten it with the rough end of a pineapple and instruct it to use its position on the board and its substantial shareholding to get those campsites open?

[Rishi Sunak]

Thank you—I think—to my right hon. Friend. I share his passion for getting our campsites open. I hope that an extra incentive today will be the cut in VAT, from 20% to 5%, which extends to campsites, as well as to caravan sites, bed and breakfasts, and hotels. I am not sure that I have the powers to summon anyone, but I will be delighted to bring to bear whatever influence I can on the matter. I look forward to discussing it with him further.

[Madam Deputy Speaker (Dame Rosie Winterton)]

In a moment, I will call the Chancellor of the Exchequer to move a provisional collection of taxes motion. Copies of the motion are available in the Vote Office. In accordance with Standing Order No. 51, on Ways and Means motions, a Minister of the Crown may without notice make a motion for giving provisional statutory effect to any proposals in pursuance of section 5 of the Provisional Collection of Taxes Act 1968. The question on such a motion shall be put forthwith.

Provisional Collection of Taxes

Motion made, and Question put forthwith (Standing Order No. 51(2)),

That, pursuant to section 5 of the Provisional Collection of Taxes Act 1968, provisional statutory effect shall be given to the following motion:

Stamp duty land tax (temporary relief)

That—

(1) This Resolution makes modifications of Part 4 of the Finance Act 2003 in relation to any land transaction the effective date of which falls in the period (“the temporary relief period”)—

(a) beginning with 8 July 2020, and

(b) ending with 31 March 2021.

(2) Section 55(1B) (amount of stamp duty land tax chargeable: general) has effect as if for Table A there were substituted—

“TABLE A: RESIDENTIAL