Boris Johnson news - live: PM misses Rishi Sunak’s jobs announcement as No 10 denies rift with chancellor
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Your support makes all the difference.Chancellor Rishi Sunak has announced a new Job Support Scheme to replace the furlough system which will see the government “directly support” the wages of people working at least a third of their normal hours.
Mr Sunak’s statement followed intense pressure from business leaders, MPs and unions to announce measures to protect millions of jobs in sectors hit by new coronavirus restrictions.
It came as Downing Street denied any rift between Boris Johnson and Mr Sunak after the prime minister chose not to attend the statement.
Sunak begins economic statement on furlough scheme replacement
Chancellor Rishi Sunak has warned the resurgence of coronavirus poses a threat to the “fragile economic recovery”.
He told MPs in the Commons: “Earlier this week the prime minister set out the next stage of the government's health response to coronavirus. Today, I want to explain the next phase of our planned economic response.
“The House will be reassured to know I have been developing plans to protect jobs and the economy over the winter period.
“Plans that seek to strike the finely judged balance between managing the virus and protecting the jobs and livelihoods of millions.”
However, Mr Sunak said it would be “fundamentally wrong” to keep people in jobs which would no longer exist without the furlough scheme.
“I cannot save every business, I cannot save every job, no chancellor could. But what we can and must do is deal with the problems that businesses are facing now,” he added.
Government to ‘directly support’ wages of people working at least one-third of normal hours
Rishi Sunak has said a new job support scheme will see the government “directly support” the wages of people in viable jobs working at least a third of their normal hours.
The chancellor said his primary goal remained “to support people's jobs” through the winter.
“The underlying rationale for the next phase of economic support must be different to what came before,” Mr Sunak said.
“The primary goal of our economic policy remains unchanged - to support people's jobs - but the way we achieve that must evolve.”
Rishi Sunak announces plan to top up wages of workers during Covid crisis
The latest breaking news, comment and features from The Independent.
‘Pay as you grow’ scheme to help businesses pay back loans, Sunak says
Rishi Sunak has said a “pay as you grow” scheme will be introduced to give small businesses more time to repay bounce back loans from the government.
He said the loans scheme had given more than one million small businesses a £38bn boost during the coronavirus pandemic.
“This means loans can now be extended from six to 10 years, nearly halving the average monthly repayment,” Mr Sunak told the Commons.
“Businesses who are struggling can now choose to make interest-only payments and anyone in real trouble can apply to suspend repayments all together for up to six months.
“No business taking up pay as you grow will see their credit rating affected as a result.”
Temporary reduction of VAT rates to remain in place until March 2021
The temporary reduction of VAT rates from 20 per cent to 5 per cent will remain in place until 31 March 2021, the chancellor has said.
“The final step I'm taking today will support two of the most affected sectors, hospitality and tourism,” Rishi Sunak said.
“On current plans, their VAT rates will increase from 5 per cent back to the standard rate of 20 per cent on 13 January.
“So to support more than 150,000 businesses and help protect 2.4 million jobs through the winter, I'm announcing today that we are cancelling the planned increase and will keep the lower 5 per cent VAT rate until 31 March next year.”
Labour’s shadow chancellor criticises delay in announcing new support scheme
Shadow chancellor Anneliese Dodds has said the delay in the introduction of the government’s new job support scheme will have impacted the confidence of businesses.
“I've called for the introduction of a system of targeted wage support 40 times,” Ms Dodds said in response to the chancellor’s statement.
“That call has been rebuffed by this government 20 times. It's a relief this government have U-turned now.
“But we must be open and honest. That delay in introducing this new scheme will have impacted on businesses' confidence.”
She added: “I know that from talking to them, and I'm sure members on the opposite benches know that from talking to businesses in their constituencies.”
Government must ensure support measures help keep workers in employment, Labour’s Dodds says
Labour’s shadow chancellor has said the government must ensure its coronavirus support measures are as “effective as possible” at keeping workers in employment.
“If the package of measures announced today can help people keep their jobs, and can help businesses through hard times, then Labour will of course support it,” Anneliese Dodds said.
“And there's much in this statement we do support. As I've just said, we've repeatedly called for a system of targeted wage support and we've repeatedly called for help for indebted cash-strapped businesses over and over again.
“But we must ensure these measures are as effective as possible at keeping workers in employment, getting unemployed people back into work and keeping viable businesses in operation.”
Our policy correspondent, Jon Stone, has more details below on the extension of the VAT cut:
VAT cut for hospitality sector extended for six months, Rishi Sunak announces
The latest breaking news, comment and features from The Independent.
Johnson received advice from architect of Sweden’s controversial coronavirus approach
Boris Johnson received advice from Sweden’s chief epidemiologist - who devised the country’s controversially soft approach to coronavirus restrictions - days before announcing new measures to curb a spike in new infections.
According to The Spectator, Anders Tegnell attended a virtual discussion with both the prime minister and the chancellor Rishi Sunak.
Downing Street confirmed Mr Johnson had received the briefing on Sunday, with his spokesperson saying he had “canvassed a wide variety of scientific opinion” over the weekend.
Our political correspondent, Ashley Cowburn, has the full story below:
Johnson received coronavirus advice from architect of Sweden’s controversial strategy
Anders Tegnell attended meeting hosted by No10 alongside PM and chancellor
Business leaders welcome ‘bold’ new measures to save ‘hundreds of thousands of viable jobs’
“These bold steps from the Treasury will save hundreds of thousands of viable jobs this winter,” said Dame Carolyn Fairbairn, director general of the Confederation of British Industry.
"Wage support, tax deferrals and help for the self-employed will reduce the scarring effect of unnecessary job losses as the UK tackles the virus. Further business rates relief should remain on the table.
"The Chancellor has listened to evidence from business and unions, acting decisively. It is this spirit of agility and collaboration that will help make 2021 a year of growth and renewal."
Stephen Phipson, chief executive of Make UK, added: "The priority right now has to be saving as many jobs as possible and this is a bold and brave move which industry will welcome.
"In particular, the Chancellor should take great credit for reflecting on the experience of other countries and implementing similar measures here; this will help us be strongly competitive as we return to normal trading conditions."
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