What does the new budget mean for the hospitality and leisure industry?
Today's budget explained
Brett Riley-Tomlinson
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“We will not be defined by the crisis, but by our response to it” This is how the chancellor ended one of the best speeches I personally have heard by a modern politician especially over the coronavirus period. But his words may have been well-spoken, but what do his new £30 billion pound policies mean to us as businesses?
With the VAT cut of 20% to 5%, means that all hospitality and tourism companies can either make their prices cheaper to encourage more people through the doors or they can keep their prices as they are and have more cash coming into the business.
On top of this, the government has announced a “Tastecard” approach on a Monday to Wednesday where all meals are eaten in our out as long as they are ordered will be 50% cheaper up to a maximum of £10 per person, with the government covering the 50% not the businesses. With the extra 50% being put in their bank account within 5 working days according to the chancellor.
Every employee which is brought back from furlough will bring a bonus of £1000
Not only this but every employee which is brought back from furlough which earns at least £520 per month up until January 2021 will bring a bonus of £1000 to that company as a thank you for keeping them employed. Therefore if everyone came back from furlough and remained employed would give a cash injection of £9,000,000,000 into the UK economy from the government.
Not only this but Chancellor Rishi Sunak plans a temporary job creation scheme for under-25s worth up to £6500 per young person as the government guarantees to pay their wages for 6 months based on the national minimum wage with employers being able to top up their wages if they would like to.
So not only has VAT been cut, not only is there a bonus for each employee brought back from furlough, but the huge temporary job creation scheme gives access to hundreds of thousands of 18-24-year-olds who need to gain crucial work experience and develop their skill set in these key industries. With the scheme set to help over 150,000 businesses, and help protect 2.4 million jobs across the industry They only time will tell the effect these will have on the industry and the country as a whole.
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