Chancellor Rishi Sunak is set to unveil new measures to offset the impact of the coronavirus pandemic on the UK economy today (8 July).
At his economic update, which has been billed as “a summer statement” and “a mini-budget”, the frontbencher is expected to announce a stamp duty holiday and insulation vouchers, among other perks.
But it’s another announcement which is grabbing headlines - a rumoured £2 billion ‘kickstart scheme’ to create more jobs for young people.
Here’s everything you need to know about it.
What is the ‘kickstart scheme’?
Sunak’s statement is expected at 12:30 BST, following Boris Johnson’s weekly debate with Labour leader Keir Starmer at Prime Minister's Questions.
The new fund is reportedly designed to help people on Universal Credit aged between 16 and 24 who are at risk of long-term unemployment, and is expected to subsidise six-month work placements.
The Treasury has said the kickstart scheme would be part of a "three-point plan for jobs... to help Britain bounce back from coronavirus", with hundreds of thousands of "new, high-quality" subsidised jobs to be created.
Each “kickstarter” job will see the government cover the cost of 25 hours' work a week at the National Minimum Wage. Employers will have the option to top up those payments.
The current National Minimum Wage rates are as follows:
- Under 18s – £4.55
- 18 to 20-year-olds – £6.45
- 21 to 24-year-olds – £8.20
When can I apply for the scheme?
Applications are expected to open in August, and the first jobs covered by the scheme will start in the autumn and run until December 2021.
The jobs will have the option of being extended, and the scheme will cover England, Scotland and Wales. The government said it would provide additional funding to Northern Ireland for a similar scheme.
What else is expected to be announced?
Though sweeping changes to tax and spending measures are not expected to be made during the 8 July announcement, the Chancellor is expected to unveil a £3 billion investment to help create thousands of green jobs modernising public buildings and housing to make them more energy efficient.
It’s also expected that hundreds of thousands of households will get grants of up to £5,000 to make their homes more environmentally friendly, with vouchers of up to £10,000 available to some of the poorest families.
A £30 billion ‘high street voucher’ scheme is also being touted, with vouchers worth £500 per adult and £250 per child handed out to be spent in hard-hit sectors of the economy, such as face-to-face retail, hospitality and leisure.
It’s expected to be announced that most house buyers will be exempt from paying stamp duty for six months, as the Government attempts to restart the housing market.
Traineeships could also become more common in the wake of massive coronavirus-triggered redundancies, with the mini-Budget expected to contain news on a £100 million government investment. Businesses offering new traineeships in England could receive a £1,000 bonus per trainee.
Universal Credit should also be boosted by £10 billion to support low-income families, according to a report by The Resolution Foundation think-tank.
James Smith, research director of Resolution Foundation, said, “The measures the Chancellor announces in his mini-Budget tomorrow need to be big enough to reflect the size of the crisis we face, targeted at the sectors that need the most support, and flexible enough to cope with the uncertainties that lie ahead.
“With interest rates already at record lows, the Chancellor will need to take the lead in delivering an ambitious policy response to secure Britain’s economic recovery.”