Rishi Sunak has insisted further economic support is coming in response to Covid-19, although he remained tight-lipped on the detail when challenged by MPs.
The Chancellor is facing a series of demands, including from the Conservative benches, to extend support to businesses and individuals – including the £20 weekly boost to Universal Credit.
Mr Sunak estimates it will cost between £20 billion and £30 billion to help firms with VAT and extend the business rate relief, stamp duty holiday, self-employment scheme and benefits boost.
He added it is “reasonable” to consider the suggestions “in the round at the Budget”, which is scheduled for March 3.
Speaking in the Commons, Conservative Jason McCartney (Colne Valley) asked: “With the lockdown or some form of restrictions set to continue well into the spring, will the Chancellor please give some certainty to those businesses and individuals struggling financially by announcing an early extension to his various support packages, including help with VAT, business rates, stamp duty, the self-employment scheme and of course the Universal Credit uplift?”
Mr Sunak replied: “(Mr McCartney) I hope will appreciate the various things he just mentioned total about, I think, £20 billion or £30 billion, so he will understand if it’s reasonable that we consider all of these things in the round at Budget, where we will set out the next stage of our economic response to coronavirus.”
Labour MP Lucy Powell (Manchester Central) earlier said: “While the Chancellor might pat himself on the back, reports out this week show that nearly 250,000 businesses are likely to go bust this year, taking many jobs with them. Does he recognise that he can’t pull the plug all in one go in April when many businesses won’t have even reopened at that point?”
Mr Sunak replied: “No-one, least of all me, is patting themselves on the back while hundreds of thousands of people are losing their jobs and many businesses are seeing extreme dislocation as a result of what is happening in our economy.
“I have put in place a series of measures but I have always said that we cannot protect or save every job or every business.
“The honourable lady makes a fair point, which is why we have said that we will review all our economic measures in place to support people through coronavirus at the upcoming Budget in the first week of March.”
Senior Conservative Mel Stride warned of a “looming bloodbath” when a moratorium on commercial evictions comes to an end in March.
The Commons Treasury Select Committee chairman said: “There’s a looming bloodbath for many businesses at the end of March when the moratorium on commercial landlords taking action against tenants in arrears comes to an end.
“Does my right honourable friend recognise this acute danger, and what action might my right honourable friend consider taking to avoid it?”
Mr Sunak replied: “The Housing Secretary (Robert Jenrick) is very engaged with this issue and he’s worked with the industry to put in place various codes of practice to encourage good and constructive dialogue between landlords and tenants for a difficult situation, and I think there are promising signs that that is happening.”
Conservative MP Caroline Ansell (Eastbourne) asked whether the temporary reduction of VAT for the tourism sector could be made permanent.
Mr Sunak replied: “We have an upcoming Budget where we plan to review all our existing measures.”
Today the Chancellor told me not to believe everything I read in the papers following reports he’s battling Cabinet colleagues over his plan to cut Universal Credit in a pandemic.
The papers quote the words of the Work and Pensions Secretary.
— Anneliese Dodds 💙 (@AnnelieseDodds) January 26, 2021
Shadow chancellor Anneliese Dodds accused the Treasury of putting the country’s “economic and health recovery at risk” with its “loggerheads” approach.
She told the Commons: “In recent days the Treasury has been at loggerheads with the DWP, insisting on taking £20 a week from the pockets of six million families.
“It’s also been at loggerheads with the Sage committee by claiming financial hardship is not inhibiting self-isolation.
“Why is the Treasury putting our economic and health recovery at risk in this way?”
Mr Sunak replied: “(She) shouldn’t believe everything she reads in the newspapers, but I can say that the Treasury and this Government has put in place a comprehensive and generous set of support to help people get through this crisis. The results show that we have protected those on the lowest incomes the most.”