Northern leaders respond to Chancellor’s coronavirus stimulus announcements

Business and political leaders from the North of England have responded to Chancellor Rishi Sunak’s announcement of £30 billion of economic stimulus measures following the coronavirus pandemic.

The Chancellor outlined a number of economic stimulus measures to support the hospitality and leisure sector, as well as attempt to limit rising unemployment levels due to the coronavirus lockdown. Announced measures include:

• ‘Job retention bonus’ of £1000 for each furloughed employee retained to the end of January 2021
• Cut in VAT to 5% for restaurants, hotels and attractions including theme parks and cinemas from 15th July until 12th January 2021 for selected areas
• Stamp duty holiday for purchasing homes up to £500,000
• £5,000 per household to make homes more energy efficient, with owners and landlords contributions matched £2 for £1 by government; further £50 million would go towards socially rented homes
• ‘Eat Out to Help Out’ scheme, offering 50% discounts for diners eating out Mondays, Tuesdays and Wednesdays throughout August – restaurant and pub owners can sign up to claim from the scheme online
• £2bn fund to provide six-month work placements for 16-24 year-olds on universal credit
• Grants of up to £2000 for employers taking on apprentices for six months from 1st August

While proposed measures have been broadly welcomed, some of the North’s have expressed concern over the measures.

Sarah Longlands, Director of think-tank IPPR North questioned the centralised approach of delivering schemes:

I welcome the Chancellors announcements today particularly his focus on jobs which will be crucial for the many businesses across the North who are struggling at the current time. But given that we have one of the most centralised Government’s in the developed world, I fear that he has too much confidence in the power of Whitehall to deliver this plan.

“Covid-19 has shown us the real value of devolved and local authorities working hard to support their communities. The Chancellor must now commit to working in partnership with them to deliver the economic recovery.

“Getting our economy back up and running cannot be achieved from Whitehall alone. The Chancellor talked today about the value of endurance. In the North and across the regions of England, businesses, communities and local councils have had to endure years of centralised decision making, which has seen them become poorer, sicker and with fewer job opportunities. They have had to endure ten years of austerity which has seen the most vulnerable in society, our children, those living with disabilities and older people in care disproportionately affected”.

Northern Powerhouse Partnership Director, Henri Murchison particularly welcomed support for youth unemployment:

The numbers of unemployed 16-24 year olds in the Northern Powerhouse are some of the highest in the country – the worst being the North East, followed by Yorkshire and the Humber and the North West half way down the list.

“We need to see businesses in the Northern Powerhouse step up and offer opportunities through the Kickstart Scheme as we have greater demand for it here.

“We as a Partnership will ourselves commit to do this, because we need to see the young unemployed getting experience in leading capabilities like energy, health innovation, advanced manufacturing and digital as well as creative industries that have secure longer-term prospects.

“There is still a need for a patient capital fund for Northern businesses to grow, and more local investment capabilities for our Metro Mayors to draw on.

“We will be steadfast on both those fronts alongside accelerating major infrastructure investment – such as HS2 and Northern Powerhouse Rail – in the impending Autumn spending review, because we need an economic stimulus that supports a transition to a fundamentally more-productive economy.”

Chief Executive of Transport for the North, Barry White, also welcomed greater detail on previously announced infrastructure investment proposals:

“The Chancellor’s update today is welcome news, demonstrating the Government’s will to create jobs and support economic recovery.

“The commitments to creating green jobs and supporting young workers into skilled roles are particularly essential to ensure the UK bounces back in a sustainable way. Transport and other infrastructure projects will play a vital role in making that a reality.

“We welcome the Government’s ongoing commitment to levelling up and continue to stress the need for confirmed funding for a Northern Infrastructure Pipeline of road and rail projects, including the delivery of HS2 and Northern Powerhouse Rail in full. It is vital that the Spending Review and National Infrastructure Strategy later this year set out a sustained pipeline of investment to breathe life into our Northern economy and form the bedrock of job creation, closing the productivity gap.”