Chancellor confirms additional support will be announced at Budget

27-Jan-2021 - Last updated on 27-Jan-2021 at 10:57 GMT

Government announcement: Chancellor of the Exchequer Rishi Sunak said there will be more financial support revealed at the Budget in five weeks' time

Further economic support will be unveiled at the next Budget in March, Chancellor of the Exchequer Rishi Sunak has said.

Trade body UKHospitality (UKH) wrote to the Chancellor ahead of the deadline for Budget submissions earlier this month (January), urging the Government to extend the VAT cut for another year and continue the business rates holiday for the sector throughout this year.

It also called for the Government to reveal additional support measures such as a reformed Job Retention Bonus and to extend the repayment time for all Government-backed loans for a decade, with an extra 12 months interest-free.

The trade body went on to ask for tax payments to be further deferred to December 2021 and extend the furlough scheme until the end of June.

Finance cost

Meanwhile, Sunak told Tory MPs during Treasury Questions in the House of Commons yesterday (Tuesday 26 January) the cost of new coronavirus bailouts could reach £30bn and stated additional measures would be revealed in the Budget (3 March).

MP for Eastbourne Caroline Ansell asked the VAT cut for hospitality to become a permanent fixture.

She said: “I have long believed there was a compelling case for reducing VAT for the hospitality sector and the pandemic-inspired cut helped to save the season between lockdowns.”

Furthermore, Blyth Valley MP Ian Levy called for the Government to consider “reinstating” the Eat Out to Help Out scheme, or a similar initiative when lockdown restrictions are lifted.

Series of measures

Sunak stated he would review all economic support schemes at the Budget and added: “I have put in place a series of measures, but I have always said we cannot protect or save every job and every business.”

However, Treasury minister Jesse Norman also told MPs there were no plans to extend the VAT cut beyond March.

He said: “The relief comes at a significant cost and while the Government keeps taxes under review, it has no current plans to extend it further.”