Rebecca Evans, Minister for Finance and Trefnydd and Ken Skates, Minister for Economy, Transport and North Wales
The Chancellor of the Exchequer today set out the UK Government’s Winter Economy Plan against the backdrop of a resurgence in Coronavirus and increasing uncertainty for business and workers.
The UK Coronavirus Job Retention Scheme (CJRS), which will end next month, has been essential to protect Welsh jobs and has delivered support at an unprecedented scale which can only be provided by the UK Government.
We have consistently urged the UK Government to put in place new arrangements in parallel with the CJRS being wound down. In particular we have pressed for increased support for those sectors hit hardest, greater efforts towards job creation as well as job security and more investment in training and skills, all of which will assist the economy to recover more quickly.
While we welcome the Chancellor’s announcement today, the timing is unfortunate as it comes after the latest possible date for redundancy notice periods to begin for those in the CJRS. Support should be offered to help workers who are being made redundant now and those who will be made redundant in the weeks ahead as current employment subsidy schemes disappear.
More needs to be done to help people find new jobs and incentivise employers to hire new workers. There needs to be greater focus on supporting job creation, so vital if the economy is not to go back into recession in the months ahead, and which was notably absent from the Chancellor’s announcement today.
Without more action on skills, training and job creation the UK risks being placed at an immediate disadvantage compared with European nations who are adopting that approach and workers who need that support most will lose out in the long term. Here in Wales we have made a pledge to support everyone to find work, education or training or help to start their own business supported by over £90m of funding and we would expect the UK Government to take equivalent measures using the fiscal powers at their disposal.
We are also disappointed the Chancellor was unable to respond to our repeated requests for more targeted support including for large employers based in Wales who are integral to the success of a diverse UK economy such as steel and aerospace. These affect the livelihoods of thousands of people, and today many jobs are still at great risk when the Chancellor had a real opportunity to provide the security needed.
It is unclear why the Chancellor has decided that viable jobs are those that are currently able to work at least a third of their hours. Many businesses, especially in the arts and also where many jobs will not currently be able work a third of normal hours, would still likely be sustainable in the long run.
We welcome the Chancellor’s decision to extend the VAT reduction for the hospitality and tourism sector until March 2021, extend repayment deadlines for businesses which have deferred VAT and provide more flexibility for businesses which have taken out Government-backed loans. However, overall the measures announced today, unfortunately, are unlikely to be sufficient to prevent a large rise in unemployment in the months ahead. More needs to be done, and we will continue to press the UK Government to take bolder steps to assuring our economic recovery and supporting future prosperity for businesses and people across the UK.