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In a mini-budget at Westminster, the Chancellor is to announce a £2billion “Kickstart” scheme designed to save hundreds of thousands of youngsters from the scourge of unemployment. He is also expected to trigger an immediate stamp duty holiday for most property sales to rejuvenate the housing market as well as unleashing a “New Deal” surge in construction and green renovation projects. Ahead of today’s Commons statement, the Chancellor insisted that protecting younger workers from unemployment will be his top priority as the economy emerges from the coronavirus lockdown.
He said: “Young people bear the brunt of most economic crises, but they are at particular risk this time because they work in the sectors disproportionately hit by the pandemic.
“We also know that youth unemployment has a long-term impact on jobs and wages and we don’t want to see that happen to this generation.
“So we’ve got a bold plan to protect, support and create jobs – a Plan for Jobs.”
Mr Sunak will promise a “young jobs revolution” designed to save the country from the soaring levels of youth unemployment last seen during the 1980s.
Under his £2billion Kickstart Scheme, the Government will pay employers to provide hundreds of thousands of “high quality” six-month work placements for workers aged between 18 and 24.
Youngsters claiming Universal Credit who are currently at risk of long-term unemployment will be eligible for the scheme.
The Treasury will fund 100 percent of the National Minimum Wage for workers on the scheme for 25 hours a week. Employers will be able to top up the wages further.
Mr Sunak believes the six-month placements will give youngsters the chance to learn skills and gain vital experience to improve their chances of going on to find long-term jobs.
Treasury data suggests younger workers are far more likely to have been “furloughed” during the lockdown than their older counterparts.
At the same time, the number of people aged under 25 claiming jobless benefits has increased by a quarter since the lockdown began in March.
Ministers also fear that many youngsters leaving full-time education this summer will face an extremely difficult jobs market.
Mr Sunak will also announce a £111million investment to triple the number of traineeships in the current financial year and a further £17million to triple the number of work academy placements in 2020-21.
His three-point Plan for Jobs will include measures designed to protect existing jobs, support firms through the coming months and create new jobs for the future.
Other key measures to be announced tomorrow include a £5billion package of infrastructure spending on roads, hospitals and schools to trigger a construction boom.
And a further £3billion package designed to make Britain’s economy “greener” will also be unveiled. It will include grants of up to £5,000 to make hundreds of thousands of homes more environmentally friendly.
Homeowners will be able to spend the cash on loft, wall and floor insulation, eco-friendly boilers, heat pumps, double or triple-glazed windows, low-energy lighting and energy-efficient doors.
The Green Homes Grant scheme is designed to provide extra work for plumbers, builders and other tradesmen to get the economy motoring.
Treasury officials have also been studying at a temporary six-month increase in the stamp duty threshold from the current level of £125,000 to an amount between £300,000 and £500,000 to stimulate the housing market, seen as a key driver of economic growth.
At Treasury questions in the Commons yesterday, the Chancellor insisted he was “proud” of the measures the Government has taken to support the economy through the lockdown.
He said: “I am proud of what this Government have put in place and the speed at which we have done so.
“The jobs of nine million people have been protected through our furlough scheme; 2.7 million self-employed people have had their income supported; and millions of companies have received access to loans, grants, tax deferrals.
“In sum, this represents £130 billion of support—one of the most comprehensive and generous support packages available of any country anywhere in the world.”
He added: “The Government has taken unprecedented steps to keep as many people as possible in their existing jobs, support viable businesses to stay afloat and protect the incomes of the most vulnerable.
“We are now carefully and safely reopening our economy.”
The Federation of Small Businesses last night called for a “jobs first” mini-budget after a survey showed one in ten small firms are cutting jobs as the economy emerges from the lockdown.
Mike Cherry, chairman of the federation, said: “The Chancellor needs to take a jobs first approach. Bringing down employment costs and increasing opportunities will be central to recovering from this recession.
“After the financial crash, nine in ten people who left unemployment to re-join the workforce did so through a small business or self-employment, so it’s clear where support should be targeted.”
Labour’s shadow chancellor Anneliese Dodds said: “Labour has repeatedly called on the Government to match the ambitions of Labour’s Future Jobs Fund, to rise to the youth unemployment challenge. To the extent that the ‘Kickstart’ programme is based on the Future Jobs Fund model, it should help many young people to access work.
“However, the Government is yet to rise to the scale of the unemployment crisis. The urgent priority right now is to prevent additional unnecessary unemployment in the first place by abandoning the Government’s ‘one-size-fits-all’ approach to the removal of the Job Retention and Self-Employed schemes. In addition, older people who become unemployed, and those living in particularly hard-hit areas, will also need tailored support.
“The Government also urgently needs to get test, track and isolate right, as ultimately the biggest drag on our economy has been the slow public health response, which threatens additional localised lockdowns and which has reduced consumer confidence.”
Claire Walker, of the British Chambers of Commerce, said: “The Kickstart Scheme will help firms create and support thousands of opportunities for young people, maintaining their access to the job market and driving the UK’s economic recovery.
“The Chancellor has responded to our calls to prioritise work experience and job opportunities for those entering the world of work at a particularly challenging time. The Chamber network stands ready to work with the Government on the detail of the scheme to ensure it is successfully delivered on the ground.
“This announcement must form part of a wider plan to boost business confidence and protect livelihoods as we restart, rebuild and renew the UK economy.”
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