Rishi’s dishes ‘leave a bad taste for taxpayer’
TWO schemes unveiled by chancellor Rishi Sunak to stem job losses may not be value for money for taxpayers, a top official has warned.
HM Revenue and Customs head Jim Harra wrote to Mr Sunak to express concerns about paying companies £1,000 to retain furloughed staff.
He also questioned the value for money of a discount scheme offering 50 per cent off restaurant meals.
Mr Harra requested two formal ministerial directions to go ahead with the job retention bonus aimed at staving off redundancies and the ‘eat out to help out’ scheme despite his own concerns.
In both letters to the chancellor, he said each have ‘sound policy rationale’ but noted they had both received advice that ‘highlights uncertainty around the value for money of this proposal’.
Paul Johnson, the director of the respected Institute for Fiscal Studies, warned a ‘reckoning, in the form of higher taxes’ would have to come.
He also said most of the £9billion from the job retention bonus scheme will be paid for staff ‘that would have been, indeed already have been, returned from furlough anyway’ and would have been in work in January regardless.
Labour leader Sir
Keir Starmer (pictured) also said ministers could not afford the ‘dead weight’ in investment. During a visit to Harlow, he said the funds ‘should have been targeted in the areas that most need it, not across the piece’.
Mr Sunak told BBC Radio ’s Today that ‘without question’ there has been ‘dead weight in all of the interventions we have put in place’.
He said: ‘In an ideal world... you would minimise that dead weight and do everything in incredibly targeted fashion. The problem is the severity of what was happening to our economy, the scale of what was happening, and indeed the speed that it was happening at demanded a different response.’ Meanwhile, The Resolution Foundation argued Mr Sunak’s ‘remarkably conventional’ latest spending ‘risks falling short of what will be required’.
It was among those warning that the move to immediately lift the minimum stamp duty threshold from £125,000 to £500,000 in England and Northern Ireland would ‘largely benefit’ those in London and the south of England.
The experts also warned that few firsttime buyers will benefit and instead they will lose their ‘privileged’ tax position over other purchasers.