Summer Economic Update

On Wednesday 8 July, the Chancellor delivered a summer economic update, announcing several measures aimed at supporting jobs and the economy as the furlough scheme comes to an end.

The main measures affecting businesses included:

  • A reduction to the standard rate of VAT on food, accommodation and attractions, from 20% to 5% between 15 July 2020 and 12 January 2021, in a bid to support the hard-hit hospitality sector.
  • A one-off £1,000 bonus for employers if they bring a furloughed employee back to work and keep them in employment until the end of January 2021. Those employees must earn, on average, above the lower earnings limit of £520 per month.
  • Subsidised six-month work placements for 16-24-year-olds who are on Universal Credit and at risk of long-term unemployment. The Government will cover 100% of the national minimum wage for up to 25 hours per week.
  • Grants for businesses taking on apprentices, of £2,000 for each new apprentice under the age of 25, and £1,500 for each new apprentice older than that. This scheme runs from 1 August 2020 to 31 January 2021.
  • An ‘Eat Out to Help Out’ discount scheme, allowing participating food service businesses to claim back 50% on food they serve, up to £10 per person. This scheme runs from Monday to Wednesday, throughout the month of August.
Author Name: 
Siobhan