Announcements from the Chancellor of the Exchequer, Rishi Sunak:
- Will make statutory sick pay available to all advised to self-isolate
- Will provide separate $500M hardship fund, administer by local authorities
- For businesses with under 250 staff, will refund cost of up to 14 days of staff sick pay due to coronavirus
- Will provide temporary loans to businesses
- Government will guarantee 80% of bank loans of up to 1.2m to small businesses
- Will scrap business rates property tax altogether for some smaller firms
- Self-employed people will get sick benefits from day one
- Business rates abolished for small businesses 'entirely' for a year
- Total fiscal stimulus of GBP30 billion
- There will be further GBP18B of fiscal loosening this year
- Total coronavirus measures will cost GBP7B
- We are in close contact with G7 counterparts
- Very small business will receive a GBP3000 cash grant, costing GBP2 billion
- Cuts GDP growth forecast to 1.1% from 1.4%
- Will fund extra GBP175B for infrastructure over next 5 years for 'prosperity fund'
- UK budget will meet fiscal rules with room to spare
- Sees 2021/22 deficit at 2.8% of GDP
- 2022/23 deficit of 2.5% of GDP
- Forecasts 2024/25 public debt to GDP ratio of 75.2%
- Will introduce new plastic packaging tax from April 2022
- Will freeze climate change levy on electricity and increase it on gasoline
- To end subsidized diesel outside of agriculture, heating and rail industry
This is an impressive and timely set of measures. It's not going to turn the tide in GBP or anything like that but it's exactly the kind of highly-targeted stuff that will both slow the spread of the virus and help businesses survive the outbreak. I don't see a lot of fluff here on the immediate measures and the 175B infrastructure spend is a massive investment.
The size of this package rivals what was unveiled in 2008.
