BREAKING: Chancellor announces Job Support Scheme and hospitality-specific VAT freeze

Millie Milliken

Millie Milliken

24 September 2020

Rishi Sunak has today (24 September) outlined 'radical interventions' that will support workers on reduced hours and extend the reduced 5% VAT cut until 31 March 2021

The Chancellor laid out plans that he believes give reason for workers to be 'cautiously optimistic' amid the current coronavirus pandemic.

Talking in parliament today, he outlined two specific announcements that he claims will help save jobs and businesses, including those in the hospitality sector, over the winter period. 

'I've been developing plans to protect jobs over the winter period,' he explained to the house. 'For at least the next six months the virus and restrictions are going to be a fact of our lives. Our economy is now more likely to undergo a... permanent adjustment.'

The announcement comes in the wake of the recent 10pm curfew imposed on businesses, as well as the impending end of the furlough scheme, of which Sunak claimed 'there has been no harder choice'.

The new measure specific to hospitality are:

  • A new Jobs Support Scheme: This will support the wages of people in work, giving businesses who face depressed demand the chance to keep employees in work on shorter hours. Employees must work at least one-third of their normal hours, which will have to be paid by their employers. The government and the employer will then cover one-third each of the hours not worked, and employees will keep their jobs. It will be open to employers who both have and have not used the furlough scheme and will be in place for six months starting in November.
  • 5% VAT cut extended: The original date of VAT returning to normal was 12 January 2021, but the Chancellor has now extended it until 31 March 2021.

Sunak also announced plans for a Pay-As-You-Grow scheme, which will see bounceback loans for businesses extended from six to 10 years, while business interruption loans will also be extended to 10 years.

Related content

News |  Wine

Breaking: Chancellor announces VAT cut and 'unique' eat out voucher scheme to help hospitality

Rishi Sunak also a £9bn Job Retention Bonus, Kickstart Scheme, cut to VAT and 'Eat out, help out' initiative.

News |  People & Places

'Pubs, bars and restaurants to close tonight', says Boris Johnson, as chancellor announces job retention scheme

Any employer can apply for grant to keep paying their employees in an effort to reduce losing staff. These grants are eligible for any business, including hospitality.

News |  People & Places

Mixed reactions from hospitality businesses following chancellor's VAT cut and voucher scheme

While food-focused pubs, bars and restaurants have welcomed the announcement, wet-led venues and breweries are calling for more help from the government.

News |  People & Places

Trade bodies for hospitality and drinks industries call for more targeted support following Chancellor's announcement

Following the Chancellor Rishi Sunak's Covid-19 financial support announcement earlier today, a number of hospitality and drinks industry trade bodies have responded asking for more targeted help.