Rishi Sunak outlines furlough bonus, stamp duty holiday and £3bn green building plan
Rishi Sunak has announced a raft of measures to support construction jobs and boost housing to protect the sector from mass redundancies in the coming months.
Employers who bring back furloughed staff will be paid £1,000 per employee, stamp duty will be cut on homes worth less than £500k until 31 March next year and home owners will get a £3bn grant to make their houses greener.
But Ranjit Dhindsa, head of employment at law firm Fieldfisher, questioned the worth of the bonus which comes with strings attached.
“Most businesses have planned what they were going to do on the assumption there was no bonus. Furthermore, the condition that employment has to be maintained till January is also quite difficult. A lot of employers can’t plan that far ahead yet.”
Despite the stamp duty cut being initially planned for the autumn, it will now take effect immediately due to fears the housing market would be frozen in the interim after the plans leaked.
The chancellor (pictured), who called today’s speech the second phase of the government’s economic response to covid-19, said new apprenticeships will be created with employers paid £2,000 per apprentice for people aged under 25 and £1,500 for those aged over 25.
Sunak also promised to triple the number of places in sector based work academies, and provide £100m to create more places on level two and three courses for 18- and 19 year olds hoping to find work in high demand sectors, including engineering and construction.
Pledging a green recovery, the chancellor also earmarked £1bn to make public sector buildings greener and £2bn for a Green Homes Grant.
The grant will allow homeowners and landlords to apply for vouchers to make their homes more energy efficient, with the government covering at least two thirds of the cost up to £5,000 per household.
For low-income households, the vouchers will cover the full cost up to £10,000, while social housing will receive £50m to pilot green fit-outs including wall insulation and heat pumps.
The measures would see up to 650,000 homes retrofitted and create 140,000 green jobs, the chancellor claimed.
But several industry chiefs have said the green measures don’t go far enough. Dave Sheridan, chairman of modular housebuilder Ilke Homes, said: “While the chancellor’s measures to retrofit 650,000 homes are absolutely on the money, building new eco-homes must remain the priority.”
Meanwhile, the cut on stamp duty received a mixed response with firms complaining there was no clarity on the government’s Help to Buy initiative which is due to wind down next March.
Redrow chief executive Matthew Pratt said: “The conclusion of the current [Help to Buy] scheme now coincides with the end of the stamp duty holiday and we think this needs to be carefully reconsidered to avoid a cliff-edge of support for customers. We call on the Government to extend the deadline for [Help to Buy].”
And Jan Crosby, UK head of infrastructure, building and construction at KPMG, said: “The market has already been motoring since lock down has been relaxed – pricing has remained stable and new reservations have been high. This has demonstrated the large pent up demand that still exists for home ownership. The stamp duty cut may therefore not have been needed. More important is providing longer term clarity on Help to Buy.”