Some adept thinking from the chancellor is welcome, says Paul Briddon of Lovewell Blake – but he will certainly need to do more in the autumn.
With his empathetic demeanour, creative thinking and adept touch, Rishi Sunak has been one of the few politicians to emerge from the coronavirus crisis with credibility – and yesterday he once again demonstrated why he has the respect of many right across the political spectrum.
Many of the measures announced had been signalled in advance of the statement, but the speech delivered more than expected; whether it will be sufficient to hold back the economic flood which threatens us remains to be seen.
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In these days of political sloganeering, it was perhaps inevitable that eye-catching initiatives such as the ‘Eat Out To Help Out’ £10 restaurant voucher would grab the headlines, but behind this came a measure of real substance which will deliver real benefits to Norfolk and Suffolk: the cutting of VAT on hospitality and tourism to five per cent for the next six months.
In a region where these sectors employ huge numbers of people, and where many people still need persuading that it’s the right time to start giving such businesses their custom again, this move has the potential to make a real difference.
The cutting of stamp duty will be welcomed by house buyers, but equally by the region’s construction sector, another major employer.
The decision to put this move into place until March next year will give house builders the time to bring forward construction and employ more people to deliver homes in time for buyers to meet the deadline.
The biggest hurdle facing many businesses in the coming months is the end of the Job Retention Scheme.
The chancellor knows that the taxpayer cannot fund the scheme indefinitely, so the Job Retention Bonus is designed to wean the nation off such dependency with a £1,000 grant to employers for each furloughed worker brought back and still in a job at the end of January.
This move will inevitably help some who don’t need it, but if it enables businesses in sectors such as retail and hospitality to wait a little longer to see how the recovery is going, then it may yet be effective in saving jobs.
The chancellor says he is moving forward ‘unencumbered by dogma’, and such massive state intervention in the economy is unprecedented from any chancellor, let alone a Conservative one. These are huge and welcome first steps – but there is likely much more he will need to do come the autumn.
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