8th July 2020
I am sure members listened with interest to the Chancellor’s speech this lunchtime. It was good that he recognised that support for businesses, particularly those in hospitality and tourism were especially badly hit by the Covid-19 crisis. However, the cut in VAT to 5% which went beyond what we had asked for, is far more circumscribed then the Chancellor led us to believe in his statement. Below are the relevant extracts from the document published when the Chancellor sat down. You will see that the VAT cut only applies to hotel rooms and the entry price for visitor attractions. Welcome though that will be in driving footfall to the coast, it is not what we had hoped for – an across the board cut to help industry. On food and drink it is not entirely clear whether the VAT cut applies to takeaway food. More details will be published by HM Treasury in the next few days. We will continue to press for a cut in MGD.
The £1000 bonus for those previously furloughed employees that are employed through to the end of January 2021 looks like it could be a helpful boost to payroll costs, but again we await more details which have been promised ‘before the end of July’.
I am still getting reports of police telling publicans across the UK that pool tables can’t be used in pubs. Helpfully the snooker federation, who were told by DCMS Minister Nigel Huddleston this week, that they could be open, has indicated that the use of snooker and pool tables is fine (in snooker/pool halls) if proper cleaning regimes are in place. As you know I am trying to get this kind of clarity around the use of pool in pubs and will continue to press for an answer. In the meantime I hope this news might enable you to reassure customers that the use of pool tables is fine if they follow the bacta/UKH/BBPA guidance.
Please keep an eye out for an invitation to Divisional Zoom meetings next week. It would be good if members could get together and share their experiences after week one of re-opening in England. We can use the feedback to tweak our guidance and hopefully improve the chances of persuading Scottish and Welsh Governments that members’ premises can open safely.
Extracts from the Chancellor’s Plan for Jobs
Temporary VAT cut for accommodation and attractions – From 15 July 2020 to 12 January 2021, to support businesses and jobs, the reduced (5%) rate of VAT will apply to supplies of accommodation and admission to attractions across the UK. Further guidance on the scope of this relief will be published by HMRC in the coming days.
Temporary VAT cut for food and non-alcoholic drinks – From 15 July 2020 to 12 January 2021, to support businesses and jobs in the hospitality sector, the reduced (5%) rate of VAT will apply to supplies of food and non-alcoholic drinks from restaurants, pubs, bars, cafés and similar premises across the UK. Further guidance on the scope of this relief will be published by HMRC in the coming days.
Job Retention Bonus – A one-off payment of £1,000 to UK employers for every furloughed employee who remains continuously employed through to the end of January 2021. Employees must earn above the Lower Earnings Limit (£520 per month) on average between the end of the Coronavirus Job Retention Scheme and the end of January 2021. Payments will be made from February 2021. Further detail about the scheme will be announced by the end of July.
Kickstart Scheme – £2 billion fund to create hundreds of thousands of high quality 6-month work placements aimed at those aged 16-24 who are on Universal Credit and are deemed to be at risk of long-term unemployment. Funding available for each job will cover 100% of the relevant National Minimum Wage for 25 hours a week, plus the associated employer National Insurance contributions and employer minimum automatic enrolment contributions.
Traineeships for young people – The government will provide an additional £111 million this year for traineeships in England, to fund high quality work placements and training for 16-24 year olds. This funding is enough to triple participation in traineeships. For the first time ever, the government will fund employers who provide trainees with work experience, at a rate of £1,000 per trainee. The government will improve provision and expand eligibility for traineeships to those with Level 3 qualifications and below, to ensure that more young people have access to high quality training.
Employer Apprenticeships Payment – The government will introduce a new payment of £2,000 to employers in England for each new apprentice they hire aged under 25, and a £1,500 payment for each new apprentice they hire aged 25 and over, from 1st August 2020 to 31st January 2021. These payments will be in addition to the existing £1,000 payment the government already provides for new 16-18 year-old apprentices, and those aged under 25 with an Education, Health and Care Plan – where that applies.
The full document can be read here: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/898421/A_Plan_for_Jobs__Web_.pdf