11:12 am, July 9, 2020
Jobs are at risk if economic activity does not return to normal, the chancellor has warned.
Rishi Sunak is urging people to embrace post-lockdown freedoms in an effort to secure jobs, after announcing a package of £30bn extra spending to bolster the economy yesterday in his summer statement.
Sunak said he was ‘anxious’ about the state of the UK’s economy which is ‘entering into a very significant recession’ because of the coronavirus crisis.
Among the extra £30bn support package, the chancellor announced firms will be given a £1,000 bonus if they bring back furloughed staff and keep them employed until January.
Other measures included an ‘eat out to help out’ plan for dining out in August and a cut to VAT on food, accommodation and attractions from 20 per cent to five per cent from July 15 until January 12, and a temporary increase in the stamp duty threshold.
The extra spending is on top of almost £160bn already committed to dealing with the coronavirus crisis
But despite the chancellor urging consumers to go out and spend to support jobs at risk, the much-anticipated cut on VAT on new cars to kickstart sales and support suffering dealers was left out of the announcements.
Now there are concerns within the automotive industry that despite the chancellor’s package of measures designed to help the economy, the lack of support for the car sector will see jobs being lost.
Commenting on the chancellor’s summer statement, SMMT (Society of Motor Manufacturers and Traders) chief executive, Mike Hawes, said: ‘It’s bitterly disappointing the chancellor has stopped short of supporting the restart of one of the UK’s most important employers and a driver of growth.
‘The automotive sector has been particularly hard hit, with thousands of job losses already announced and many more at risk. Of Europe’s five biggest economies, Britain now stands alone in failing to provide any dedicated support for its automotive industry, a situation that will only deter future investment.
‘We urgently need government to expand its strategy and introduce sector-specific measures for UK auto to support cash flow such as business rate holidays, tax cuts, and policies that provide broader support for consumer confidence and boost the big ticket spending that drives manufacturing. Until critical industries such as automotive recover, the UK economic recovery will be stuck in low gear.’
What was in the chancellor’s summer statement yesterday?
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