Economic Update

Part of the debate – in the House of Commons at 1:03 pm on 8th July 2020.

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Photo of Rishi Sunak Rishi Sunak The Chancellor of the Exchequer 1:03 pm, 8th July 2020

I thank the hon. Lady for her questions. I will run through them as quickly as I can. She asked about the block grant adjustment. The OBR will do final costings for these policies in the coming week, and once those costings have been done, the block grant will be adjusted as quickly as possible. It should be done based on OBR costings, as is normal for these matters.

The hon. Lady asked about Barnett. I am pleased to tell the House that the sum total of Barnett funding for Scotland as a result of all the interventions through this crisis is now £4.6 billion, which is going to support similar measures in Scotland to the ones we are providing elsewhere.

The hon. Lady asked about the inclusion of different businesses in the VAT cut. For attractions, I refer her to principal VAT directive annex III, paragraph 7, where the existing legislation is drawn. The guidance will be published tomorrow, for SIs to be laid next week and to come into force on Wednesday. That paragraph has the full range covered in our existing legislation.

It is absolutely important that we invest in our future. This is something that matters keenly to both me and the Prime Minister, which is why, in the Budget, we delivered on the Prime Minister’s ambitions to level up in every part of this country with investment plans that tripled the amount of investment in our country from the last four decades. It is a significant commitment of our level of ambition and support for every part of this United Kingdom, building prosperity for the future by having an investment revolution. The hon. Lady can be reassured that we remain committed to that goal.

The hon. Lady also asked about support for those who are older. Not quite for the first time, although the only other time that we did it was very time-limited, we are introducing a payment to businesses to take on apprentices over the age of 25—£1,500 per apprentice taken on—for the simple reason that while most people think of apprentices as young people, some 44% or so of new apprentice starts are actually over the age of 25. It is important that we provide that financial incentive at this time of economic distress, to try to create as many new apprenticeships as possible, including for those who are older, who will of course also benefit from all the other universal skills interventions that my right hon. Friends the Secretary of State for Work and Pensions and the Secretary of State for Education will take forward.

More broadly, the measures that I announced today—the jobs retention bonus for furloughed employees, the kick-start scheme, the VAT cut and the “eat out to help out” discount—are all incredibly significant interventions and all of them benefit the entire United Kingdom. It is important to note, as I have heard from the hon. Lady and other members of her party, how important tourism is to the Scottish economy—something that my Scottish colleagues have made clear to me. Rural communities and coastal communities especially play a disproportionately important part in the Scottish economy. The “eat out to help out” measure and the VAT reduction for these economies will be absolutely vital in driving Scotland’s growth going forward. That is a reminder to everyone that we are stronger together, one United Kingdom.