Originally written by Timothy Adler on Small Business
What does the Summer Statement mean for small business?
Chancellor Rishi Sunak has announced a package of measures to help small businesses survive the coronavirus pandemic, as the second phase of government action.
Mr Sunak unveiled cash grants of £1,000 for each furloughed employee a business takes back, a new £2bn jobs scheme aimed at bringing in young people into work, and VAT being slashed to 5 per cent for hospitality and attractions businesses.
“It will give businesses the confidence to retrain and hire this autumn,” Mr Sunak announced in the House of Commons this afternoon.
Job Retention Bonus
Mr Sunak announced a £9bn initiative to reward businesses that bring furloughed employees back into work.
Any small business that takes back a furloughed employee will be given a £1,000 grant for each worker, providing they are still in employment by the end of January. Workers must have been continuously employed and earn an average of more than £520 per month in November, December and January.
Mr Sunak said: “If you stand by your workers, then we will stand by you.”
Reacting to the announcement, Howard Kennedy head of employment law Jane Amphlett said: “The bonus is likely to provide an incentive for employers
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Rishi Sunak Summer Statement what it means for small business
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
What does the Summer Statement mean for small business?
Chancellor Rishi Sunak has announced a package of measures to help small businesses survive the coronavirus pandemic, as the second phase of government action.
Mr Sunak unveiled cash grants of £1,000 for each furloughed employee a business takes back, a new £2bn jobs scheme aimed at bringing in young people into work, and VAT being slashed to 5 per cent for hospitality and attractions businesses.
“It will give businesses the confidence to retrain and hire this autumn,” Mr Sunak announced in the House of Commons this afternoon.
Job Retention Bonus
Mr Sunak announced a £9bn initiative to reward businesses that bring furloughed employees back into work.
Any small business that takes back a furloughed employee will be given a £1,000 grant for each worker, providing they are still in employment by January. The minimum wage of each employee should be at least £520 a month.
Mr Sunak said: “If you stand by your workers, then we will stand by you.”
Kickstart jobs scheme
As expected, chancellor Rishi Sunak has announced a £2bn scheme for small business owners to hire young people as part of his Summer Statement.
The new Kickstart scheme will help half
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Sunak decides whether to subsidise small businesses hiring young people
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Rishi Sunak, the chancellor, is deciding whether to subsidise small businesses giving young people aged below 25 full-time jobs.
Such a scheme, which could be announced next week when the chancellor unveils his plans to get the UK economy moving again, would be similar to the future jobs fund which ran between 2009 and 2010.
The commitment to subsidise young people working for small businesses would be part of an “opportunity guarantee” to ensure that every young person has a chance of an apprenticeship or an in-work placement.
>See also: How to reopen your restaurant, pub or hotel post-lockdown
Young people aged below 25 are the most vulnerable when it comes to the jobs market post pandemic, with the Bank of England estimating 9 per cent unemployment as the country struggles back onto its feet. According to a Be the Business survey published this week, businesses expect to lay off 11 per cent of already furloughed workers, while a quarter have already had to make redundancies.
Although the future jobs fund cost the Treasury £720m when it ran in 2009-10, the Exchequer recouped half its cost through taxes. Yet then prime minister David Cameron axed the scheme, saying
Hot Business News Today
Sunak decides whether to subsidise small businesses hiring young people
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Rishi Sunak, the chancellor, is deciding whether to subsidise small businesses giving young people aged below 25 full-time jobs.
Such a scheme, which could be announced next week when the chancellor unveils his plans to get the UK economy moving again, would be similar to the future jobs fund which ran between 2009 and 2010.
The commitment to subsidise young people working for small businesses would be part of an “opportunity guarantee” to ensure that every young person has a chance of an apprenticeship or an in-work placement.
>See also: How to reopen your restaurant, pub or hotel post-lockdown
Young people aged below 25 are the most vulnerable when it comes to the jobs market post pandemic, with the Bank of England estimating 9 per cent unemployment as the country struggles back onto its feet. According to a Be the Business survey published this week, businesses expect to lay off 11 per cent of already furloughed workers, while a quarter have already had to make redundancies.
Although the future jobs fund cost the Treasury £720m when it ran in 2009-10, the Exchequer recouped half its cost through taxes. Yet then prime minister David Cameron axed the scheme, saying
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Google gives £25m worth of free ad spend to British small businesses
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Google has announced it is giving £25m worth of free ad spend to British small businesses as part of a wider SME help package.
Qualifying UK small businesses will be awarded up to £800 ($1,000) in ad spend grants, applied to their existing Google advertising accounts.
The gift is part of a wider package of help for British small businesses including help for getting businesses noticed in internet searches and 10,000 hours of free business mentoring for UK SMEs and charities.
>See also: Should I reduce my marketing budget due to coronavirus?
The £800 ad credit can be used for future Google ad spend, including search, display and YouTube advertising.
To qualify, small businesses must have spent through a Google Ads account in 10 out of 12 months in 2019, or in January and/or February of this year.
The ad credit must be used by December 31, 2020.
However, the headline £25m figure is being shared with Government agencies and NGOs. Google was unable to say how much has been specifically ringfenced for British small businesses.
Google itself will ascertain which customers are eligible for the free ad credit, so there is no need for you to do anything. The credit
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Treasury mulls employment allowance boost for small business hiring
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Rishi Sunak is debating whether to increase the employment allowance in order to encourage Britain’s 5.9m small business to take on more staff.
Currently, small businesses can save £4,000 off their national insurance bill through the employment allowance. More than 600,000 small businesses pay nothing in national insurance contributions through the scheme.
But the Treasury is mulling whether to increase the employment allowance much further in order to head off what has been dubbed “Jobpocalypse Now” as workers come off furlough. The Coronavirus Job Retention Scheme will expire completely by end-October. The Bank of England expects unemployment to jump from 4 per cent to 9 per cent between April and June 2020, the highest rate since 1994 – and that is even before the furlough scheme even starts to wind down from August.
Separately, the Treasury is also debating whether scrap national insurance this year for small businesses, a proposal which the Taxpayers’ Alliance estimates could save or create between 595,000 and 892,000 jobs
Tej Parikh, chief economist at the Institute of Directors (IoD), told the Telegraph that “Increasing the employment allowance would be a sensible step to take in the Budget statement,” he said.
Craig Beaumont, director
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What the revamped furlough scheme means for your small business
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
As expected, Rishi Sunak has announced changes to the furlough scheme affecting small business.
August: small businesses will be expected to cover national insurance and pension contributions of workers on the Coranvirus Job Retention Scheme. For the average claim, this represents 5 per cent of the gross employment costs the employer would have incurred had the employee not been furloughed
September: businesses will have to cover 10 per cent of the wage costs of furloughed workers on top of NI and pension contributions. For the average claim, this represents 14 per cent of the gross employment costs the employer would have incurred had the employee not been furloughed.
October: businesses will have to cover 20 per cent of furloughed workers wage costs plus NI and pension contributions. For the average claim, this represents 23 per cent of the gross employment costs the employer would have incurred had the employee not been furloughed
Previously, it was assumed that small business owners would only be on the hook for National Insurance contributions, not pensions as well.
>See also: Small businesses will have to cover a quarter of cost of furlough
In the heavily trailed move, chancellor Sunak will allow furloughed workers
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New entrants to be stopped from joining the jobs furlough scheme
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Rishi Sunak is to stop new applicants from joining the jobs furlough scheme, in a bid to continue winding the scheme down.
Part-time working from furloughed staff is expected to be allowed from August, following pressure from MPs and retail associations. The government has announced that non-essential shops can reopen from June 15.
However, according to the Financial Times, the chancellor wants to stop new applicants from joining the Coronavirus Job Retention Scheme (CJRS) to stop them from going on furlough and immediately coming back off it to work part-time – leaving the Treasury to pick up the bill.
>See also: Government launches business Coronavirus Job Retention Scheme
Mr Sunak is expected to announce changes to the jobs furlough scheme including asking small businesses to cover 20 per cent of the cost of the CJRS, as well as allowing part-time furlough, by the end of this week.
Currently, 8m people are on furlough, roughly a quarter of the total jobs in Britain.
A quarter of company directors surveyed by the Institute of Directors say they won’t be able to afford to pay even the 20 per cent of the furlough scheme if asked – as well as having to
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Small businesses could have to cover up to one third of furlough cost
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Rishi Sunak is set to announce this week that small businesses will have to cover anything between 20-30 per cent of the cost of furlough.
Meaning that small businesses will have to fork out £833 per month to keep each staff member on furlough if they’re claiming the full £2,500 amount.
And small business owners will also have to pick up the cost of national insurance contributions on top, on average 5 per cent of wages, says the Times.
According to accountancy firm Wellers, this would cost an additional £245.73 per month, bringing the monthly total for each furloughed employee to over £1,000 a month.
However, the government will still cover the cost of pension contributions. Previously, Bloomberg reported that the Treasury was considering asking businesses to cover both national insurance and pensions.
>See also: Rishi Sunak extends job retention furlough scheme to October
What’s being floated today goes much further.
Unemployment scrapheap
The fear is that many small businesses, especially those in leisure and hospitality, will be forced to throw staff onto the unemployment scrapheap, as the Treasury effectively ends the Coronavirus Job Retention Scheme (CJRS) in August, not October.
The hospitality sector, which will be the very last sector to reopen,
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Businesses may have to cover insurance and pensions of furloughed staff
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Rishi Sunak could ask thousands of small businesses to cover national insurance and pension contributions of staff on furlough from August.
Earlier this month, announcing the Coronavirus Job Retention Scheme would be extended until the end of October, the chancellor said that businesses would have to share some of the cost with government.
>See also: Rishi Sunak extends job retention furlough scheme to October
According to Bloomberg, one idea under consideration is asking small businesses to share the pain by covering national insurance contributions and auto-enrollment pension contributions of furloughed staff.
Over a million businesses have furloughed staff through the CJRS, which covers up to 80 per cent of an employee’s wages capped at £2,500 per month.
The fear is that asking mothballed businesses to cover national insurance and pension contributions will only hasten the inevitable redundancies when people come out of furlough. The gloomy prognosis is that a million or so workers currently furloughed have already lost their jobs but are being kept on furlough ventilator support.
>See also: Government launches business Coronavirus Job Retention Scheme
The government has been paying 80 per cent of the wages of about eight million workers. CJRS has cost more than £11bn and