'NO1 PRIORITY'
Rishi Sunak unveils £2.9bn package to help 1m unemployed Brits find jobs
RISHI SUNAK today unveils a £2.9billion plan to help unemployed Brits find work.
The Chancellor, ahead of his Spending Review, insisted his “No 1 priority is to protect jobs and livelihoods” from the devastation of the Covid crisis.
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He will reveal a three-year programme — the Restart Scheme — to try to assist more than a million long-term unemployed.
The concept is to give those who have been out of work for 12 months-plus regular intensive support to suit their circumstances.
But the Treasury estimates the scheme could be successful for only around 300,000, though they claim this will make it worthwhile.
That is just 70,000 more than would find work without the extra support, costing taxpayers around £42,000 for each job found.
A similar scheme launched by the 2010 Coalition Government stimulated £3.21 of extra economic activity for every £1 spent in four years.
There will be a further £1.4billion of funding for Job Centre Plus.
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Mr Sunak will also confirm funding for the next stage of his Plan for Jobs, including £1.6billion for the Kickstart programme, which the Treasury says will create up to 250,000 subsidised roles for youngsters.
He added: “The Spending Review will ensure hundreds of thousands of jobs are supported and protected in the acute phase of this crisis.”
Mr Sunak will present grim new economic data from the Office for Budget Responsibility that will reveal the impact of England’s second national lockdown.
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But in a boost for the public finances, he is poised to slice around £5billion from Britain’s bloated foreign aid budget to help pay for pandemic outlay.
Craig Beaumont from the Federation of Small Businesses said the Restart Scheme would not be enough to find jobs for the 4 million expected to be made unemployed from Covid.
He said: "Job search and job skills are important – but the best bang for the Government’s buck is backing employers to take people on or helping individuals made redundant to start up their own. "There are ultimately only three ways to have a job – if someone employs you, you employ yourself, or you keep your current one."That’s why we need a demand-led approach, lowering employer national insurance contributions and a reworked version of the job retention bonus that many were relying on but have now lost. It’s also why we we need a Restart Start-up scheme to help those made redundant to strike out on their own.
"The Government was right to declare on entering office that it wanted the UK to be the best place to start and grow a business – we need to see this, in spades, today at the spending review."
Meanwhile, Mr Sunak is urged to ditch proposals to tax pension contributions as if they were income.
The Treasury is said to be considering a 20 per cent levy to cover the cost of coronavirus — but industry bodies warn it will push people away from savings, while leading more pensioners into poverty.
Nigel Peaple, Director of Policy & Research at the Pensions and Lifetime Savings Association told The Sun they “believes that more, not less, pension saving is needed so that everyone will have an adequate income in retirement.”
He added: “People are currently not saving enough and removing tax relief will make this position worse.
“Only half of workers are on track to achieve the pensions that the 2006 Pensions Commission considered appropriate.
“Introducing major changes to the retirement saving system undermines confidence in pensions which, given the long-term nature of pension saving, is harmful and counterproductive.
“Adding tax here would essentially be a tax on employers at a time they cannot afford it.
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“A further large share goes to support the pensions of public sector workers such as nurses and teachers.
“Cutting tax relief here would result in more cost to the Government’s pay bill if it wants to avoid imposing a pay cut for these workers.”
Pension loss fear
MILLIONS of Brits could see £100billion wiped off their pensions and investments if Chancellor Rishi Sunak scraps a key inflation measure in today’s spending review.
The Retail Prices Index could be phased out between 2025 and 2030 and replaced with the typically lower Consumer Prices Index measure.
For someone with a £20,000 annual pension, the switch could cost them £119,000 in lost income over 30 years.
Tom Selby, of City firm AJ Bell, said the damage could be “colossal”.
Rishi Sunak says protecting people's jobs a 'priority' as he's quizzed on possible Spring tax hike
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