Chancellor’s statement 24.09.20

N.B: The below is a working document and we will add more information and guidance as we receive it.

Please let us know what you think about the new measures, how they affect you & what else you feel needs to be done and we will do our upmost to put your case across to Government. If you would like to share your thoughts, please email [email protected]  

We understand that many of you work in the events sector and rely on seasonal work- we are working with events associations such as the AIF, AFO, EIF and NOEA to get your voices heard and will be putting a survey out in the coming days to give Government more insight into our sector. Please help us to help you by completing this survey when it is sent to you

This lunchtime, Rishi Sunak laid out the next stage of the Government’s economic plan, The Winter Economy Plan to manage the virus and protect jobs. 

Although in March the measures brought in were hoped to be temporary and despite 3 consecutive months of growth, the resurgence of Covid-19 means that additional safety measures have been brought into place. These measures will continue to have a negative effect on the economy and so more support for businesses is needed.  

Sunak stated that for at least the next 6 months, the virus and restrictions will be part of our lives and so their plan as a Government has needed to adapt and grow in response.  

He said the economy was “now likely to undergo a more permanent economic adjustment”, that the Government needed to support people in viable jobs and it was wrong to hold people in jobs purely due to the furlough scheme.  

He went on to say that sectors and businesses are operating safely and viably but still face uncertainty and so he has introduced the new Jobs Support Scheme – here is what we know so far about the scheme:  

For people who are employed by a business:  

• The furlough scheme ends at the end of October – to combat this, the Government have brought in the Job Support Scheme 
• Many employees face redundancy and reduced hours  

• The Job support scheme allows businesses to keep employees in a job on reduced hours instead of making them redundant.  
• The scheme starts in November and will run for 6 months  
• Businesses can use the scheme if the workers they are placing on it are working a minimum of a third (33%) of their usual hours 
• These hours will be paid for by their employer  
• For the time they are not working, the Government will pay a third of their usual pay and the employer will pay a third of their usual pay.  

• For every hour not worked, the employer and the government will each pay one third of the employee’s usual pay. 
• This means that employees working a for third of their usual hours will get 77% of their usual full time pay. 
• The government contribution will be capped at £697.92 per month 
• The scheme is targeted at business that need it most – SMEs  
• Businesses can claim for both this new scheme and the job retention bonus ( a one-off payment to employers of £1,000 for every employee who they previously claimed for under the scheme, and who remains continuously employed through to 31 January 2021).  

For people who are self-employed:  

• The Government’s SEISS current scheme provides 2 grant instalments, the second has a deadline of the 19^th of October. Each grant is worth 70% of your average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits, and capped at £6,570 in total. 
• This ends in October and so a new grant will be made available if you are self-employed from November  
• The extension will start in November and last six months. It’ll be paid in the form of two taxable grants – the first will cover from the start of November to the end of January, and the second February until the end of April. 
• The first grant will cover 20% of trading profits for three months, capped at £1,875. It will be paid in a single instalment. The level of the second grant has yet to be set and we will let you know as soon as there in any information on this.  

• ONLY those eligible for the current SEISS scheme can apply – you must have filed a tax return for 2018/19, must earn more than 50% of your total income from self-employment and your average trading profit must be no more than £50,000/yr.  

“Pay as you Grow”- helping businesses repay Government backed business loans  

• If you have taken out a bounce back loan or CBILS loan, the payment terms on either loan can be extended from six to ten years, almost halving repayments. Interest-only payments can be made, and firms in “real trouble” can suspend their pay-outs. 
•  The Government backed loan schemes are open until 30th November 2020 for new applications.
• A new guarantee loan programme will begin in January  

• Businesses will be able to spread their VAT bills over 11 separate payments  

VAT in hospitality & leisure businesses  

• VAT will not increase from 5% to 20% on 13 January as planned  
• The lower rate of VAT for hospitality and leisure businesses will stay in place until 31 March 2021. 

This is the information as it stands – we will add additional guidance as we receive it.