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UK coronavirus live: Rishi Sunak makes summer statement on economic recovery UK coronavirus live: Rishi Sunak unveils furlough bonus, stamp duty cut and August discount for eating out
(31 minutes later)
Follow live updates on the latest on the coronavirus crisis in the UK and the chancellor’s summer statement Chancellor making summer statement in the Commons on UK economic recovery from pandemic
Sunak is turning to the detail now. Today’s measures are welcome, but they don’t add up to a new major macro-economic stimulus package, tweets Torsten Bell of Resolution Foundation:
Furlough cannot go on for ever, he says. The City may agree -- the pound is resolutely unmoved by Rishi Sunak’s statement, unchanged today at $1.255 against the US dollar.
If he says it should end in October, critics will say November. If he says November, they will say December. The Treasury has not published a “red book”, the document that normally accompanies a budget with 100 pages or so of detail, but it has produced a 27-page paper summarising the announcements. It is not on the Treasury website yet.
He says keeping it open for ever will give people “false hope” that their jobs will survive. Here is the key chart from the document, showing how much the measures announced today will cost.
He says the furlough scheme will wind down gradually, protecting jobs until October. The Stamp Duty holiday on properties sold for less than £500,000 is likely to support the market, and prop up house prices.
The Treasury have tweeted the government’s progress against the Covid-19 slump so far..... Shares in house builders Persimmon and Barratt Development have gained 1%, with London estate Foxtons up 2.5%, as City traders anticipate a pick-up in housing demand between now and next March.
Sunak says the public finances must be put back on a sustainable footing in the medium term. It’s also likely to push prices up as people “take the plunge” into the housing market, says Mark Peck, head of residential at estate agent Cheffins:
Sunak says the second phase, now, is about protecting jobs. Here is the Treasury news release summing up these announcements.
After that will come a third phase, when they need to rebuild. Sunak says he believes in values.
Sunak says the economy contracted by 25% - the same amount it grew over the past 18 years. He says he believes in endurance.
He says he will “never accept unemployment as an unavoidable outcome”. And that’s it. Sunak has finished.
The job of protecting employment has only just started, he says. Sunak says his final measure has never been tried in this country.
Sunak says nationalists cannot ignore the truth that Scotland was only able to benefit from this because “we are a united kingdom”. It is an “eat out to help out scheme”, offering customers as discount worth up to £10 per head when they eat out from Monday to Wednesday in August.
Sunak says the economic response is moving through three phases. Sunak says he has two measures to get these sectors moving.
In the first stage the lockdown was announced. VAT on tourism and hospitality is at 20%.
One of the largest economic responses in the world was announced, a £160bn plan. It will be cut to 5% until January, he says.
He ways they spent £49bn protecting public services. This is worth £4.5bn, he says.
And research being published today will show the poorest were protected the most. Sunak says 80% of hospitality firms stopped trading in April.
Rishi Sunak starts by saying in March, when he delivered his budget, he knew people were worried. They are worried still. The best jobs programme is to restart these sectors, he says.
They are anxious about unemployment rising. People are cautious about going out, he says.
The summer economic update is about to start. But if people are careful, we can all enjoy summer safely.
Steve Baker, a Conservative, says we must get Brexit done. Can the PM confirm the Northern Irish protocol won’t stop the UK applying whole-UK tariffs? Turning to housing, Sunak says house building support nearly 750,000 jobs.
Johnson says the protocol won’t lead to anything hindering GB/NI trade. But property transactions fell by 50% in May.
Labour’s John Spellar says blue passports are being produced by a French company in a Polish factory. Will the PM instruct councils and government to buy British? Uncertainty abounds in the market, he says.
Johnson says the government will actively buy British. But it will not turn its face against international free trade, he says. Yet they need people to be confident.
Johnson says the government remains committed to building 40 new hospitals. Sunak says stamp duty will be abolished on homes worth up to £500,000. The cut will last until 31 March 2021.
Labour’s Catherine West asks the PM to legislate to protect people at risk of homelessness. The average stamp duty bill will fall by £4,500, he says.
Johnson says the way the government was able to help the homeless was one of the best features of the crisis. And he says this will take effect immediately.
Danny Kruger, a Conservative, asks what the PM will do to strengthen community spirit. Conservative MPs are welcoming the chancellor’s Job Retention Bonus to encourage workers to bring furloughed employees back .
Johnson says he thinks there is a chance to build on the way the nation came together during the coronavirus crisis. Here’s Milton Keynes North MP Ben Everitt:
And Robert Courts of Witney and West Oxfordshire:
But by not extending the furlough scheme, workers still face a worrying cliff-edge this autumn -- will a £1,000 bonus make the difference to a struggling firm?
Sunak confirms he will spend £2bn on a new green homes grant.
On top of this, there will be £1bn of funding to improve the energy efficiency of public buildings, he says.
These measures should make 650,000 homes more energy efficient, saving families £300 a year, he says.