We were told in
advance via leaks to the media it was going to be a game-changing New Deal
economic statement, with a deep green tinge.
Sadly- but unsurprisingly-
reality proved this wide of the mark.
The Chancellor said
that his plan will create tens of thousands of jobs through bringing forward
work on £8.8 billion of new infrastructure, decarbonisation and maintenance
projects.
This includes a £3
billion green investment package that could help support around 140,000 green
jobs and upgrade buildings and reduce emissions, he stressed.
As part of this
package homeowners and landlords in England will be able to apply for vouchers
from a £2 billion Green Homes Grant scheme this year to pay for green
improvements such as loft, wall and floor insulation that could save some
households hundreds of pounds a year on their energy bills while creating
thousands of jobs for tradespeople.
And a £1 billion
programme will make public buildings, including schools and hospitals, greener,
helping the country meet its ambitions of achieving Net Zero by 2050, whilst
investing in our future prosperity.
The second part of the plan is to support job creation.
That begins with historic investment in infrastructure – creating jobs in
every region and nation of the UK.
At 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, better high
streets, creating jobs in all four corners of our country.
In addition, £5.8 billion will be spent on
shovel-ready construction
projects to get Britain building. This includes £100 million for our local roads
network, which many would say undermines carbon-saving initiatives by promoting carbon- emission road
use.
His specific words on green initiatives were
“Mr Speaker,
As well as investing in infrastructure, we want to create green jobs.
This is going to be a green recovery with concern for our environment at
its heart.
As part of that, I’m 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’ll 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
over 650,000 homes more energy efficient
- save
households up to £300 a year on their bills
- cut
carbon by more than half a mega tonne per year, equivalent to taking
270,000 cars off the road
- and,
most importantly right now, support around 140,000 green jobs
A £3 billion green jobs plan to save money; cut carbon; and create jobs.”
Marie Claire Brisbois, Lecturer In
Energy Policy in the Science Policy
Research Unit (SPRU) at the University of Sussex Business School, was the closest
to my reaction in this reaction:
“While the funding
package is a very welcome initial step, the funds committed fall short of what
is required to upgrade the leakiest, least energy efficient housing in Europe
and takes a piecemeal approach to what needs to be a comprehensive, system-wide
transformation.
“Further significant
investments will be required to transition to low carbon heat, provide
sufficient funds or schemes for retrofitting all private and social housing
stock, and incentivize retrofits in the private rental market.
“This can all be done
more efficiently as a whole energy systems transformation package that
addresses the larger systemic reforms associated with electrification,
digitalisation, and decentralisation. This would have the potential to build
upon the lifestyle changes the pandemic has highlighted as desirable including
changes to working schedules and commuting patterns, active transportation and
mobility services, and leisure practices.”
City University Professor Richard
Murphy, co –author of the Green New Deal report with my friend Colin Hines, was
excoriating (The economic gloom in the UK will have increased after
today’s dismal performance from Sunak; Posted: 08 Jul 2020 05:42 AM PDT https://www.taxresearch.org.uk/Blog/2020/07/08/the-economic-gloom-in-the-uk-will-have-increased-after-todays-dismal-performance-from-sunak/)
“What to make of the Sunak Summer Statement?
There are a number of immediate thoughts.
First, never before has so little been held back for announcement to the
Commons. Only two real new issues were announced today - and those were the
furlough bonus scheme (which is an extension of the scheme in all but name) and
the restaurant voucher scheme.
Second, what is staggering is how small the
sums involved are. It appears that we have £9 billion extra for what looks like
a furlough extension to January; just £1 billion for the unemployed; a subsidy
for house prices via stamp duty, £3 billion for green schemes (but that already
had been announced in March and if anything seems to have shrunk since
then), £4 billion of VAT subsidy for tourism and some small sum for cheap
outing out in August.
Third, it seems that once again Sunak has
massively underestimated the scale of the issue he is facing. The scale of this
is just so small - and even naive. The suggested cost of the furlough bonus
scheme presumes no one now furloughed will lose their job, and that is absurd:
those jobs are already disappearing.
So what did we get? Some token gestures. And
that is it. Literally, all we got here is some wallpaper to keep Sunak going
until we get an autumn statement. There was no big idea. There was no evidence
of a philosophy behind any of this. And nor was there a clue that there was any
real commitment to an industrial policy - indeed, even the green scheme
feels like nothing more than a reannounced version of previous plans.
A deep sense of disquiet overwhelmed me as
Sunak sat down. I wanted to yell ‘is that it?’ The hollowness was what struck
me.
So let me offer a contrast. Anneliese Dodds’
response was technically very sound. She opposed tax cuts. She discussed SME
cash flow issues. She highlighted the real risks. And she made clear there was
no plan. Tories will be worried and Labour delighted. But that is the best I
can offer from a miserable statement.
The economic gloom in the U.K. will have
increased after this dismal performance from Sunak.
Meanwhile, in The House of Commons at Westminster, MPs provided their own
responses, Anneliese Dodds, Labour /Co-op MP for Oxford East, & shadow
Chancellor, observed in response:
“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.”
She clearly rankled
Sunak, who hit back asserting:
“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.”
SNP Treasury spokeswoman,
Alison Thewliss, MP for Glasgow Central, was also unimpressed
by the green measures, pointing out:
“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.”
“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.”
But
the Chancellor did receive some backing for his green plans from Tory MPs. Darren Henry, MP for Broxtowe said:
“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 responded:
“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.”
“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.”
“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.”
“… 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—“
Rishi Sunak was unable to fully help:
“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.”
But Green Party MP Caroline
Lucas who represents Brighton, Pavilion was unimpressed:
“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 bullishly retorted:
“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”.
The
Guardian’s
environment correspondent, Fiona Harvey, rounded-up some of the critical
responses from the green policy community (“'Not what a green recovery looks
like': Rishi Sunak's plan gets mixed response,” 8 July 2020
18.40 BST). She wrote that the “Summer statement’s focus on energy
efficiency welcomed but disappointment that no boost for renewables.”
There was no lack of advice for the chancellor on measures to green the
economic recovery from the coronavirus crisis from top economists and the government’s own climate advisers.
But the Rishi Sunak seems to have focused on just one
– home insulation – to a mixed reception from green experts and industry
figures.
The £3bn to be spent on improving energy efficiency in the next
year, £1bn on public buildings such as schools and hospitals and the rest in
vouchers of up to £10,000 for households, is expected to result in 650,000
warmer homes and support 140,000 jobs. Experts, from the Nobel-winning economist Joseph Stiglitz to
the International Energy Agency, had called for
such measures, as a fast way to create jobs while making permanent emissions
reductions and setting the UK on a path to net zero emissions.
“This is a really good package,” said Chris Stark, the chief executive of
the Committee on Climate Change (CCC), the government’s statutory adviser. “We
said the government should focus on job creation, and the biggest area of job
creation is energy efficiency. This is a genuine stimulus, as it is big money
that has to be spent quickly.”
The voucher system will operate from September and the £3bn is to be spent
in 2020-21. At least 15m homes need insulation, and all houses in the UK must
be switched to low-carbon heating to meet net zero emissions by 2050. Stark
said the next step must be to put in place policies to safeguard the jobs for
the long term.
There are also question marks over the prime minister’s promise
of £12bn to build new social housing. The CCC has said about 1m homes built
since 2008 will have to be refurbished, as they were constructed to inadequate
standards. But the promised new homes in the “new deal” will also fall short if
government plans to introduce a low-carbon home standard from 2025 are not
brought forward, Stark said. “It’s an expensive problem that we don’t need.”
Other measures that the CCC, economists and
experts had called for received less attention. Renewable energy, essential to
reaching the target of net zero emissions by 2050, received no new boost.
Electric vehicles were parked on the hard shoulder, along with other hoped-for
green transport measures.
Building out broadband would create jobs and help those working at home, but
the chancellor was silent on that. Measures to restore nature also received
little funding, with just £40m for a green jobs challenge fund, despite
promises of tree-planting and landscape restoration.
Craig Bennett, the chief executive of the Wildlife Trusts, said: “The money
allocated to help restore nature falls embarrassingly short of what is needed
to tackle the twin emergencies we face: climate change and nature loss.”
There were a few unexpected crumbs for pet projects.
Technology for capturing carbon dioxide directly from the air will receive
£100m, and there was £10m for the automotive transformation fund, looking at
blue sky projects for green mobility.
Other countries have moved further and faster. France is spending about
£13bn on its green recovery measures, while Germany is looking to top £35bn.
The EU as a whole is pursuing a $1tn green deal.
Anna McMorrin, the shadow minister for international development, said:
“This is not what a green recovery looks like. The chancellor touts a green
recovery in one breath but invests in high-carbon industry both at home and
overseas in another, pumping billions into fossil-fuel projects abroad.”
Greenpeace said Sunak had had the opportunity to spend £15bn on
“shovel-ready” projects that would have created hundreds of thousands of green jobs
while cutting emissions. Rebecca Newsom, the head of politics, said: “The
chancellor made many of the right noises about sparking a green recovery. But
instead of digging in to deliver on this promise, he seems to have downed
spades with the job only partly done. The government has missed the opportunity
to kickstart the green recovery we need.”
The chancellor has delayed the national infrastructure strategy to later in
the year, so the lack of detail on large-scale infrastructure projects was not
surprising. Carbon capture and storage, hydrogen, green transport and
large-scale energy projects might take more time to come to fruition, and could
be included in the autumn statement.
However, green experts are worried that time is running out. Ed Matthew,
the associate director at the thinktank E3G, said: “This was not a recovery
statement, let alone a green one. It was an economic intervention to keep
people spending money and save existing jobs once people come off furlough.
There was very little on economic vision or recovery. But we are in a climate
emergency and need urgent action to decarbonise the economy now. We need that
comprehensive green recovery plan yesterday.”
Chancellor Rishi Sunak has confirmed a
£3 billion green jobs plan to save money, cut carbon and boost employment in
the wake of the coronavirus pandemic – but what do businesses think? Here is the
EnergyLiveNews round-up:
(“Rishi Sunak’s Summer Statement: Industry responds: Wednesday
8 July 2020; https://www.energylivenews.com/2020/07/08/rishi-sunaks-summer-statement-industry-responds/)
In his much-awaited
Summer Statement, which serves as a recovery plan for the UK economy, he
outlined how he planned to tackle “profound economic challenges” with a
“historic investment in infrastructure”.
He promised to create
green jobs to ensure a green recovery that holds “concern for our environment
at its heart”.
Any net zero-focused
stimulus package is welcome
Steve Jennings, Head
of Energy & Utilities at PwC UK, commented: “Any stimulus package that
helps us on the path to net zero by 2050 is welcome and the £2 billion
committed to green homes grants will help accelerate the pace at which homes
are retrofitted with energy-saving insulation. Not only is this critical to the
success of any widespread energy efficiency programme, it will also quickly
create jobs, which is hugely important to the economic recovery following the
COVID-19 crisis.
“A recent report
published by PwC and Energy UK highlighted that 60% of consumers are more
engaged with their energy use than before lockdown, which means the timing of
this grant scheme is coming as people take a greater interest in the impact of
their energy use, both in terms of the environment and their pockets.”
We expect more
positive news to be delivered in the Autumn budget
Mark Richards,
Partner of Energy, Environment & Infrastructure at Bryan Cave Leighton
Paisner, told ELN: “Reflecting on the Chancellor’s statement, it seems we are
all super-Keynesians now, focusing on a green recovery and much-welcomed
capital investment to retain and protect jobs. It would be easy to be
disappointed at the lack of spending commitments to large capital projects –
however this statement was really about stimulating the UK economy and
protecting jobs.
“I’m sure the
Chancellor will have plenty in reserve, in terms of sustainable capital
investment, to announce as part of the National Infrastructure Strategy to be
released in the Autumn, as part of the Autumn budget and spending review.
The shape of the UK recovery will dictate the extent of capital investment and
further stimulus and we hope the Chancellor can continue to work at ways to
enable private sector investment and delivery of capital investment in our energy
and infrastructure.”
Upgrading homes is
essential – and so is slashing energy bills through efficient measures
Director of the
Centre for Energy Policy at the University of Strathclyde, Professor Karen
Turner, said: “We welcome the public investment announced by the UK Chancellor
today to help make homes across England more energy efficient. Our economic
analysis shows that this can help aid near term economic recovery through the
jobs created for installers and for example in sectors that manufacture and
sell the materials needed. This immediate boost is one key priority for
government at the moment and will be an important way to ensure that the
impacts of the economic downturn are minimised.
“However, the
Chancellor is correct to identify that another priority is to get money into
people’s pockets as quickly as possible as a result of reduced energy bills.
Our analysis shows that this is more likely to transpire where grants reduce
the need to recover costs, for example through loan repayments, near term rises
in energy bills (as is the case with the current ECO programme) or increased
taxation.
“Our research also
shows that, while it is important to more fully support low income households
in increasing energy efficiency and reducing fuel poverty, this will provide
limited stimulatory power, simply because such households have limited spending
power. On this basis, our research shows the important near term and sustained
wider economy benefits of using public funds to support increased energy
efficiency across all households. The contributory voucher scheme is a good
first step in this regard.
“Crucially the
announcement made today shows that actions that will help the UK meet climate
change targets can also be good for people and the economy, both in the short
and long term.”
Home and building
upgrades are key to sustainable recovery
Michael Lewis, CEO of
E.ON, suggested: “There can be no doubt upgrading the UK’s homes and buildings
is the best possible way for a green economic recovery; it delivers more jobs,
more economic stimulus – quicker and with more tangible impacts– as well as
other benefits including better health and wellbeing and lower energy bills. It
will also spread those benefits across the country in the areas that need it
the most.
Upgrades mean homes
will be healthier, more comfortable and greener
Caroline Bragg, Head
of Policy at the Association for Decentralised Energy said: “Our members-
energy businesses up and down the country- are delighted that the government
has today kickstarted a national buildings renovation programme.”
She added that this
will allow industry to “get started providing good, green-collar jobs right
away” and stated if policies are designed correctly, the support could employ
close to 40,000 people over the next two years and make homes “healthier, more
comfortable and greener”.
The prominence of
green recovery in the speech was encouraging
Chris Holmes, Co-lead
Investment Adviser to environmental infrastructure fund JLEN, said :“It is
encouraging to see the green economy being so prominent in the government’s
budget today. Arguably, the impacts of climate change could be much greater
than the current economic crisis we face – coastal flooding, extreme weather,
drought and forest fires could severely disrupt agriculture, infrastructure and
livelihoods.
“While companies that
are most closely linked with carbon generation, such as airlines and oil and
gas companies, have been some of the worst hit by the coronavirus,
environmental infrastructure assets, such as wind and solar plants, have proven
very robust during these uncertain times, reinforcing the investment case for
building a sustainable future.”
Funding announcement
falls short of what is required
This announcement
only represents 2% of all households in the UK
Commenting on the
green homes grant announced in the Chancellor’s summer statement, Peter Earl,
Head of Energy at comparethemarket, said: “Building greener homes is an
essential part of creating a more sustainable future, and this grant is a
tentative step in the right direction. Lower household bills, annual savings
for millions of households, and a greater focus on measures that help our
planet are all welcome news for households across the UK.
“However, it’s
important to put the amount pledged into context; whilst it is enough to
upgrade 650,000 homes, this only represents 2% of all households in the UK.”
Green jobs proposal
will barely touch the sides of the unemployment crisis
The New Economics
Foundation tweeted: “The chancellor’s new green jobs proposal will barely touch
the sides of the unemployment crisis. Our green jobs proposal will cut
unemployment by much more. How do we make up the shortfall? Through more
valuable jobs in care and health.”
This ambition must
continue through the rest of 2020
In response to the
economic update, Chris Venables, Head of Politics at Green Alliance, said:
“Today’s speech could mark a really positive first step on the green recovery –
but only if this ambition is continued throughout the rest of the year, and
particularly in the Autumn budget. The Chancellor’s commitment to putting the
environment at the heart of the recovery is obviously excellent – now we need
funding and detail to turn this into reality.
“We urgently need to
see a clear funding strategy for supporting public transport in its time of
crisis, a long term strategy to ensure all buildings are warm and cheap to run,
reversing the catastrophic declines in nature, and investing the technology of
the future. The jury is still very much out on how green the UK government’s
recovery will be – and we’ll be watching over the coming weeks and months.”
Disappointing and
short-term
Scottish Carbon
Capture & Storage tweeted: “Sunak’s statement on economic recovery is
disappointing – the only #GreenRecovery bit is the announcement on home
insulation – which is good, but not enough – and his idea of job protection is
just about hospitality and tourism. No long-term #NetZero #JustTransition
vision here.”
Many aspects of a
true green recovery were absent
Richard Black,
Director of the Energy and Climate Intelligence Unit (ECIU) said: “In addition
to the £3 billion already announced to help people make their homes warmer,
today’s announcement opens up another potential avenue through which the UK
could start making its energy use less wasteful, by providing employers
incentives for job creation and retention.
“With construction
being the sector most dependent on furlough funding and yet house-building
plans likely to be stymied by uncertainties about the market, insulation is one
of those sectors ripe for stepping up activity quickly and easily using the
funding on the table.
“Having made repeated
statements about the need for a ‘green’ recovery, there are many aspects that
this week’s announcements haven’t covered, such as renewable energy and
electric vehicles. The presumption must be that the Chancellor sees these as
offering less immediate opportunity for job creation than warm homes and will
address them thoroughly in his Autumn Budget.”
Len McCluskey, the
Unite general secretary, criticised Chancellor Sunak’s summer statement will
not do enough to protect jobs, saying:“Redundancy notices are already flying around like confetti, so today was the day we needed the chancellor to put a stop to this with policies as bold and as necessary as the jobs retention scheme (JRS).
This statement failed that test. With no modification to the JRS, that dreaded October cliff-edge for businesses and workers has now been set in stone. Our fear is that the summer jobs loss tsunami we have been pleading with the government to avoid will now surely only gather pace ...
The jobs retention bonus barely touches the sides of what needs to be done to support our strategic industries, which are looking enviously across the Channel at governments giving up to two years’ support to help businesses and workers get back on their feet.
Where was the long-term and creative approach urgently needed to protect the jobs of Britain’s workers - such as short-time working - while we build back demand?”
Annex
A Plan for Jobs speech
A
Plan for Jobs 2020 speech as delivered by Chancellor Rishi Sunak
Published
8 July 2020
Delivered
on: 8 July 2020 (Transcript of the speech, exactly as it was delivered)
Mr
Speaker,
I
stood here in March saying I knew people were worried.
And I
know they’re worried still.
We
have taken decisive action to protect our economy.
But
people are anxious about losing their job, about unemployment rising.
We’re
not just going to accept this.
People
need to know 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.
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 this spirit,
driven always by the simple desire to do what is right.
Mr
Speaker,
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 a million businesses to protect jobs, through tax cuts, tax
deferrals, direct cash grants, and over a 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’m 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.
Mr
Speaker,
Four
months on, as we carefully reopen our economy, we are entering the second phase
of our economic response.
Despite
the extraordinary support we’ve already provided, we face profound economic
challenges:
- world economic activity has slowed, with the IMF
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 it grew in the previous eighteen
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
haven’t done everything we have so far just to step back now and say, ‘job
done’. In truth, the job has only just begun.
Mr
Speaker,
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 Honourable 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 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 – it is merely the
next - in our fight to recover and rebuild after coronavirus.
Mr
Speaker,
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’m
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.
And
the longer people are on furlough, the more likely it is their skills could
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 only exist because of a government
subsidy.
So
the furlough will wind down, flexibly and gradually, supporting businesses and
people through to October.
But
while we can’t 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’re introducing a new policy to reward and incentivise employers who
successfully bring furloughed staff back – a new Jobs Retention Bonus.
If
you’re an employer and you bring someone back who was furloughed - and you
continuously employ them through to January – we will pay you a £1,000 bonus
per employee.
It is
vital people aren’t just returning for the sake of it – they need to be doing
decent work.
So
for businesses to get this 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 nine million people who have been furloughed, this
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.
Mr
Speaker,
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
- second – create jobs
- and third – protect jobs
Mr
Speaker,
Let
me start with supporting jobs, and 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 this generation, so today, I am announcing the Kickstart Scheme:
A new
programme to give hundreds of thousands of young people, in every region and
nation of Britain, the best possible chance of getting on and getting a job.
The
Kickstart Scheme will directly pay employers 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 these 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 Kickstarters with
training and support to find a permanent job.
If
employers meet these 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 Kickstarters in their new jobs this
autumn.
And I
urge every employer, big or small, national or local, to hire as many
Kickstarters as possible.
Today,
I’m making available an initial £2 billion; enough to fund hundreds of
thousands of jobs.
And I
commit today: 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. 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
- to support 18-19-year olds
leaving school or college to find work in high-demand sectors like
engineering, construction and social care, we’ll provide £100 million to
create more places on Level 2 and 3 courses
- and the evidence says
careers advice works, 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.
The
evidence shows they work, so we will expand them – tripling the number of
places.
And
we know apprenticeships work, too – 91% of apprentices stay in work or do
further training afterwards.
So
for the next six months, we’re going to pay employers to create new
apprenticeships.
We
will pay businesses to hire young apprentices, with a new payment of £2,000 per
apprentice.
And
we will introduce a brand-new bonus for businesses to hire apprentices aged 25
and over, with a payment of £1,500.
And
let me thank my Right Honourable Friend the Education Secretary for his support
and commitment in developing these measures.
Mr
Speaker,
We
know the longer someone is out of work, the harder it is to return.
Millions
of people are moving onto Universal Credit – they need urgent support to get
back to work.
So,
we are:
- doubling the number of Work Coaches in Job Centres
- 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.
So
I’m investing an extra billion pounds in DWP, to support millions of people
back to work.
And
I’m grateful for everything my Right Honourable Friend the Work and Pensions
secretary, and her incredible team, have done.
£1
billion of support for the unemployed; more money for skills, traineeships, and
apprenticeships; and a new, good quality job for hundreds of thousands of new
Kickstarters – the first part of our plan for jobs.
Mr
Speaker,
The second part of our plan is to support job creation.
That begins with historic investment in infrastructure – creating jobs in
every region and nation of the UK.
At 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, better high streets,
creating jobs in all four corners of our country.
Mr Speaker,
As well as investing in infrastructure, we want to create green jobs.
This is going to be a green recovery with concern for our environment at
its heart.
As part of that, I’m 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’ll 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 over 650,000 homes more energy efficient
- save households up to £300 a year on their bills
- cut carbon by more than half a mega tonne per year,
equivalent to taking 270,000 cars off the road
- and, most importantly right now, support around
140,000 green jobs
A £3 billion green jobs plan to save money; cut carbon; and create jobs.
Mr
Speaker,
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 quarter 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 31st 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 ten 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.
Mr
Speaker,
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, cafes, 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.
And
many rural and coastal communities rely on these industries.
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 wouldn’t have lifted the restrictions if we didn’t think we could do so
safely.
And
I’ve 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’m 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’ve decided, for the next six months, to cut VAT on food, accommodation and
attractions.
Eat-in
or hot takeaway food from restaurants, cafes 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 January 12th,
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,
Mr Speaker, we will go further.
The
final measure I’m 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, cafes 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 5 working days.
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’s
the third part of our Plan for Jobs.
So,
Mr Speaker,
A
£1,000 Jobs Retention Bonus.
New,
high quality jobs for hundreds of thousands of young Kickstarters.
£1bn
to double the number of work coaches and support the unemployed.
More
apprenticeships; more traineeships; more skills funding.
Billions
of pounds for new, job creation projects around 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.
Meals
out cut.
Mr
Speaker, all part of our Plan for Jobs worth up to £30 billion.
Mr
Speaker,
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, we need to embody now.
A
patience to live with the uncertainty of the moment…
…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.
Mr
Speaker, it is our Plan for Jobs and I commend it to this House.
>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Rishi's Plan for Jobs will help Britain
bounce back
The Chancellor Rishi Sunak today set out a
‘Plan for Jobs’ that will spur the UK’s recovery from the Coronavirus outbreak.
Published 8 July 2020
From:
Delivering his Summer Economic Update in
Parliament, the Chancellor announced a package of measures to support jobs in
every part of the country, give businesses the confidence to retain and hire,
and provide people with the tools they need to get better jobs.
The plan for jobs is the second part of a
three-phase plan to secure the UK’s economic recovery from coronavirus.
Throughout the pandemic, the UK Government has acted with speed to protect
lives and safeguard jobs.
The first stage was a £160 billion support
package, which included £49 billion of extra funding for the country’s vital
public services including the NHS, paying the wages of nearly 12 million people
and supporting over a million businesses through grants, loans and rates cuts.
As the UK enters the second phase in its
recovery, the Chancellor’s plan is designed to support jobs by focussing on
skills and young people, create jobs with investment in shovel-ready projects
and greening our infrastructure, and protect jobs through a VAT cut for the
hospitality sector and a landmark Eat Out to Help Out discount scheme for
diners.
The Chancellor of the Exchequer Rishi
Sunak said:
Throughout this crisis I have never been
the prisoner of ideology. For me, this has never just been a question of
economics, but of values.
We believe in the nobility of work. We
believe in the inspiring power of opportunity. We believe in the British
people’s fortitude and endurance.
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.
To give people everywhere the opportunity of a fresh start.
The Chancellor said that following this
second phase focusing on jobs, there will be a third phase focusing on
rebuilding, with a Budget and Spending Review in the autumn.
Supporting jobs
As part of the plan to support jobs, a Job
Retention Bonus will be introduced to help firms keep furloughed workers. UK
Employers will receive a one-off bonus of £1,000 for each furloughed employee
who is still employed as of 31 January 2021.
A new £2 billion Kickstart Scheme will
also be launched to create hundreds of thousands of new, fully subsidised jobs
for young people across the country. Those aged 16-24, claiming Universal
Credit and at risk of long-term unemployment, will be eligible. Funding
available for each six-month job placement will cover 100% of the National
Minimum Wage for 25 hours a week – and employers will be able to top this wage
up.
A total of £1.6 billion will be invested
in scaling up employment support schemes, training and apprenticeships to help
people looking for a job. Young people, who are amongst the worst hit by the
crisis, will benefit from this. This includes:
- Businesses will be given £2,000 for each new apprentice they hire
under the age of 25. This is in addition to the existing £1,000 payment
the Government already provides for new 16-18-year-old apprentices and
those aged under 25 with an Education, Health and Care Plan.
- A £111 million investment to triple the scale of traineeships in
2020-21 ensuring more young people have access to high quality training.
- £17 million of funding to triple the number of sector-based work
academy placements in 2020-21
- Nearly £900 million to double the number of work coaches to 27,000;
- Over a quarter of a million more young people to benefit from an
extra £32 million investment in the National Careers Service.
Creating jobs
The plan will also create tens of
thousands of jobs through bringing forward work on £8.8 billion of new
infrastructure, decarbonisation and maintenance projects.
This includes a £3 billion green
investment package that could help support around 140,000 green jobs and
upgrade buildings and reduce emissions.
As part of this package homeowners and
landlords in England will be able to apply for vouchers from a £2 billion Green
Homes Grant scheme this year to pay for green improvements such as loft, wall
and floor insulation that could save some households hundreds of pounds a year
on their energy bills while creating thousands of jobs for tradespeople.
And a £1 billion programme will make
public buildings, including schools and hospitals, greener, helping the country
meet its ambitions of achieving Net Zero by 2050, whilst investing in our
future prosperity.
In addition, £5.8 billion will be spent on
shovel-ready construction
projects to get Britain building. This includes:
- £1.5 billion for hospital maintenance and upgrades
- £100 million for our local roads network
- over £1 billion to start to rebuild schools in the worst condition
in England, plus £760 million this year for key maintenance work on
schools and FE colleges
- £1 billion for local projects to boost local economic recovery in
the places that need it most
- £142 million for court maintenance to repair around 100 courts
across England.
Protecting jobs
The plan will also protect jobs. The
tourism and hospitality sectors are massive employers in the UK and have been
severely impacted by the pandemic due to necessary closures to protect public
health. 80% of hospitality firms stopped trading in April and 1.4 million
hospitality workers have been furloughed – the highest proportions of any
sector.
Ensuring there is enough demand as
businesses reopen is key to helping these businesses recover and have the
confidence to protect jobs and rehire. Therefore, to encourage people to safely
return to eating out at restaurants the Government’s new Eat Out to Help Out
discount scheme will provide a 50% reduction for sit-down meals in cafes,
restaurants and pubs across the UK from Monday to Wednesday every week
throughout August 2020.
The rate of VAT applied on most tourism
and hospitality-related activities will also be cut from 20% to 5%. This will
save households around £160 per year on average and, together with the Eat Out
to Help Out Scheme, will support over 2.4 million staff at over 150,000
businesses, helping them recover and reopen after the Covid-19 lockdown. This will
give these businesses the confidence to maintain their staff, as more people
get through the door and business activity kick-starts again.
We want people to feel confident to move,
to buy, to sell, to renovate, and to improve their homes.
So we’re introducing a temporary increase to the Nil Rate Band of
Residential SDLT (Stamp Duty) from £125,000 to £500,000 until 31 March 2021. In
England and Northern Ireland nearly 9 out of 10 people getting on or moving up
the property ladder will pay no Stamp Duty at all. This will drive growth and
support jobs across the housebuilding and property sectors.
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