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| August 7, 2020

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NHBF disappointed with Chancellor’s Summer Economic Update

NHBF disappointed with Chancellor’s Summer Economic Update
Sam Robinson

The NHBF has raised concerns regarding the Summer Economic Update delivered by the Chancellor, Rishi Sunak, in which he announced the government’s aims to support and maintain businesses to get back to work. 

The Main Points

  • Government will not be extending the furlough scheme past October 2020.
  • A ‘Job Retention Bonus’ will be paid to any employer who brings back an employee who has been on furlough*. This amount is per employee, and subject to them being paid a minimum of £520 per month and being employed until January 2021.
  • To boost apprenticeships, the Chancellor committed to paying businesses who hire apprentices a total of £2,000 per young apprentice and £1,500 per apprentice aged 25 and over. This will be in effect for the next six months.
  • The Government will also pay employers £1,000 to take on trainees and will provide £100m to create places on Level 2 and 3 courses.
  • The ‘Kickstart Scheme’ was also unveiled, which will directly pay employers to create new jobs for any 16 to 24-year-old at risk of long-term unemployment. The job must be a minimum of 25 hours per week paid at least the National Minimum Wage with good quality training and support. If these conditions are met, the government will commit to paying six months of wages plus overheads. The scheme opens next month with a £2bn fund and there is no cap on the number of places available.

Apprenticeships

Hilary Hall, chief executive of the NHBF said, “It’s very good news on apprenticeship grants for hair salons and barbershops, especially those who may have been thinking of cutting back on apprenticeships.

Fails To Recognise

“However, the Chancellor’s economic update failed to recognise the significant support needed for hairdressers and barbers, as one of the last sectors to open, and the desperate requirements of beauty businesses who are still not yet open. We had also called for a VAT reduction for our industry.

Under-spending

She continues, “This comes as it was revealed earlier this week that local authorities have under-spent their allocated Retail, Hospitality and Leisure Grant funding by £1.7bn, a vital fund for businesses in need across the country. We are calling on the Government to act now and redirect this surplus to the retail and hospitality industries, including the hair and beauty sector.”

* Further detail will be available at the end of the month and full guidance will be available in the Autumn.

For more information and FAQs, please visit NHBF here.