Confidence boost for business
THE UK government’s decision to ‘dish out’ the cash was a move to boost confidence and stimulate an economy hit by the coronavirus pandemic.
Political commentator Nick de Bois believes Wednesday’s ‘summer statement’ by Chancellor Rishi Sunak was designed as an ‘incentive’ to British business as lockdown measure are relaxed.
The author and former Conservative MP said the mini-budget was ‘a pretty damn good idea’ and a break from Tory tradition by ‘chucking’ money to kick-start the economy.
Speaking on the Costa Blanca’s Bay Radio, he described the move as ‘really interesting’. He added: “It is not so much that he is just dishing out some cash, which is something that we are becoming used to; he began by saying ‘I am not letting ideology stand in the way of our response to coronavirus’.
“He might as well as held a hand up and said ‘this is not what you would expect a Conservative government to do but I am doing it anyway’.
“His response is to chuck money in, in an attempt to boost confidence and chuck money in to stimulate the economy.”
Nick said it was unimaginable a former chancellor like Philip Hammond would offer the nation a meal deal to help the hospitality sector.
And he said the opposition was forced to admit that faced with the seriousness of the health emergency, the government had acted to protect jobs.
JURY OUT
He questioned whether £1,000 of government money was enough to persuade an employer to keep someone in work after the furlough scheme ended in October if they did not think their business could recover sufficiently. “The jury is out on that one.”
Nick added: “But what it attempts to do is build on the confidence employers should be getting; in the sense the chancellor is getting rid of furlough slowly - furlough is over in October - so there is no cliff edge.
“He is saying if by them employers are on the borderline whether to lose someone from the team or not, let the government try and incentivise you.”
He said there were also moves to ‘encourage confidence’ in the public by offering the meal deal discount and cut VAT in the hospitality industry.
While not everyone would wish to go and sit in a restaurant or go to a theme park at present; it was an attempt to get spenders spending. “It is saying ‘if you are thinking about going out, let me give you a bit of an incentive’.”
Nick said a stamp duty holiday was also aimed at stimulating the housing market, even in property hotspots like London and the south.
“The chancellor has just changed the rules. Before you started paying stamp duty immediately a property was worth over £125,000 and then it just shoots up,” he said.
“Now he is saying there is nothing to pay on that first half million pounds you spend on a house. It saves an average of £15,000...it is very attractive and it starts now.”