The Chancellor Rishi Sunak has delivered his second Budget on 3rd March 2021, which contained a number of important announcements for UK businesses. In this blog, we summarise the key employment aspects of the Budget.
As stated in our recent blog, the Government’s Coronavirus Job Retention Scheme has been extended to 30th September 2021.
In addition, the Self-Employment Income Support Scheme will be extended to enable individuals to make grant applications covering the periods February to April 2021 and May to September 2021. Those who submitted 2019-2020 self-assessment tax returns will be eligible, estimated to be over 600,000 new and additional individuals.
HMRC have been provided with additional funding and resources to step up their efforts to investigate and take enforcement action against coronavirus fraud, including furlough and bounce back loans. A total of £100 million and over 1,000 members of staff will be deployed in a specifically designated taskforce, making it one of the largest fraud investigations in HMRC’s history.
Businesses will be pleased to note the Statutory Sick Pay (“SSP”) rebate will continue. Under the temporary scheme, employers with less than 250 members of staff can get up to 2 weeks of SSP reimbursed if it was paid due to COVID-19. The Government will be announcing steps in due course as to how the scheme will come to an end.
In a boost to traineeships and apprenticeships, cash grants have been announced by the Government. From 31st July 2021, businesses that have created new traineeship opportunities since 1st September 2020 will be able to apply for a grant of £1,000 per trainee. Similar rules for apprenticeships will be in place, with the cash grants being £3,000 per apprentice.
Rates of the national living wage will be increased as follows:
- People aged 23 and over: £8.91
- People aged 21-22: £8.36
- People aged 18-20: £6.56
- People aged 16-17: £4.62
- Apprentices: £4.30
Finally, a new visa scheme will be introduced to help start-up businesses and rapidly growing firms to source talent from overseas.
The extension of Government support will be welcomed by many businesses as they start to prepare for normality as the lockdown restrictions are gradually lifted. However the Budget will not please everyone and some will remain concerned it did not go far enough to resolve the difficulties faced by some employers and their workforce. What remains clear is that businesses and individuals will be faced with a challenging couple of months.