Anneliese Dodds calls on Rishi Sunak to “stop the last-minute scramble” and set out a proper plan for economic support

Labour’s Shadow Chancellor, Anneliese Dodds, has today (Tuesday) written to the Chancellor Rishi Sunak urging him to set out a six-month plan for economic support to go alongside coronavirus public health measures.

With the Prime Minister having announced a new nationwide lockdown on Saturday, the government has had to change the economic support package it offers to workers and businesses affected by the virus. This announcement was made just hours before the furlough scheme was due to end, and represents the fifth change of government policy in just four months.

Dodds is calling on Sunak to stop what she describes as a “last minute scramble” to keep pace with events and instead use this moment to set out a strategic, six-month plan that will give workers and businesses much-needed certainty. She has asked to meet the Chancellor to discuss this plan, and recommended that he meet with trade unions and businesses as well to work out the details.

In her letter, Dodds says that Saturday’s rushed announcement was “sadly symptomatic of what appears to be the lack of any strategic planning by your Government to support jobs and businesses”. She accuses Sunak of taking a “short-sighted approach” that is “making a bad situation worse”.

Dodds also sets out several areas that any long-term plan should cover, from the support available to areas of the country that remain under restrictions even after the nationwide lockdown to the need to protect the incomes of those who are not covered by recent announcements.

Anneliese Dodds MP, Labour’s Shadow Chancellor, said:

“The Chancellor’s stubborn refusal to address problems of his own making until the last possible minute is risking lives, costing jobs and causing chaos in the middle of a pandemic.

“Businesses need certainty if we’re to avoid a 1980s-style jobs crisis, not endless chopping and changing by a Chancellor who is always playing catch-up.

“The Chancellor must stop this last-minute scramble and use the moment of a national lockdown to set out a proper, strategic plan for the next six months that gives workers and businesses the certainty they need.”

Ends

Notes to Editors

In his statement on Saturday 31^st October, the Prime Minister announced an extension to the Coronavirus Job Retention Scheme (CJRS, or ‘furlough’) having previously ruled it out – and just hours before it was due to expire.

https://www.gov.uk/government/speeches/prime-ministers-statement-on-coronavirus-covid-19-31-october-2020

This is the policy the fifth change to the Government’s economic support packages in less than four months:

• On 8^th July, in his ‘plan for jobs’, the Chancellor announced that CJRS would end on October 31^st but eligible firms could claim a Coronavirus Job Retention Bonus for keeping furloughed staff on until January 31^st https://www.gov.uk/government/speeches/a-plan-for-jobs-speech

• On 24^th September, in his ‘winter economy plan’, the Chancellor announced that when CJRS ended it would be replaced with the Job Support Scheme, under which employees could return to work for a minimum of their pre-crisis hours and their employer and the government would each pay a third of their non-worked hours https://www.gov.uk/government/topical-events/winter-economic-plan

• On 9^th October, the Chancellor then announced an extension to the Job Support Scheme for businesses that were legally required to close as the result of local or national restrictions, under which the government would pay 67% of workers’ pre-crisis wages.

https://www.gov.uk/government/news/job-support-scheme-expanded-to-firms-required-to-close-due-to-covid-restrictions

• On 22^nd October, the Chancellor rebranded JSS as ‘JSS-Open’ and the JSS extension as ‘JSS-Closed’, and amended the terms of JSS-Open to reduce the employers’ contribution and increase the level of government subsidy https://www.gov.uk/government/speeches/chancellor-statement-to-the-house-plan-for-jobs

Letter from Anneliese Dodds to Rishi Sunak:

The Rt Hon Rishi Sunak MP, Chancellor of the Exchequer

HM Treasury

1 Horse Guards Road

London SW1A 2HQ

Tuesday 3rd November 2020

Dear Chancellor,

I am writing to request an urgent meeting to discuss the future of coronavirus-related economic support in the UK given the Government’s announcement on Saturday of a new four-week national lockdown. The nature of that announcement, given just hours before many of the existing economic support measures were due to come to an end, will have caused millions of workers and businesses significant and unnecessary anxiety.

This is sadly symptomatic of what appears to be the lack of any strategic planning by the Government to support jobs and businesses. Instead, we have had a succession of ‘plans’ based on core economic assumptions that have proved to be overly optimistic given the Government’s inability to get a grip on the health crisis – each one having to be dropped and replaced with something else as the evidence that it was not going to work became undeniable.

I fully appreciate that none of us can foresee the exact trajectory of Covid-19 but this short-sighted approach is making a bad situation worse. I urge you to use this moment to work with others to set out a proper, strategic plan for the future that can adapt to changing circumstances and give businesses and workers the certainty they desperately need.

I would ask you to meet me to discuss how this could be achieved, along with stakeholders such as trade unions and businesses. This process should enable the setting out of different scenarios for the UK economy over the next six months, and appropriate responses to those different scenarios.

It should consider solutions to problems such as:

• The need for continued, transparent and consistent support for any areas which might remain, following the lockdown, subject to additional restrictions
• The need for contingency plans for support for jobs and businesses should additional nationwide restrictions be imposed in the future by the Government and/or if the Government extends the existing lockdown
• The urgent need for income protection for groups not currently covered by recent announcements, from the self-employed to those who have not qualified for existing support due to their employment arrangements, to those who do not qualify for social security because of savings or for other reasons, to the impact of the five-week wait for Universal Credit payments
• The future for support for local authorities over the next six months and beyond, given the likelihood of continued pressures on their ability to raise revenue

The need to answer these and other questions in a strategic, coordinated manner is becoming ever more urgent given last weekend’s announcement. I stand ready to help, as I am sure do trade unions and businesses. I urge you to meet with me and relevant stakeholders so that we can learn the lessons from recent months and give businesses and workers the stability and security they need in these extraordinary times.

Yours sincerely,

Anneliese Dodds MP

Shadow Chancellor of the Exchequer