Sunak has done well so far in the job, he's come across as suited to the role and spoken eloquently about the difficulties we face.
The problem is that all his department has done so far his spend money, to the point where we are looking at an annual deficit to make 2009 cry. At some point, he's going to have to cut spending and raise taxes, or find a way to introduce a big dose of inflation into the economy, that's when life gets more difficult for him.
That said, he deserves our best wishes, there's no easy way out from where we are now.
Quantitative Easing.
The Bank has printed £300bn this year which means in reality how much is our deficit this year? Also prevents deflation and adds a bit of much needed inflation into the country.
What's going to matter more is future years. The deficit will have to close again, not this year but before too long.
Fundamentally we're going to have to keep tipping cash into circulation to keep large parts of the economy open. Will be a long term problem to manage that is less bad than the immediate short term contraction of money stopping circulating. If we get the suggested £1,500 in Sunak tokens (2 adults 2 kids) then I'll go and spend £1,500 in tokens in the bits of the economy they are intended for. If we don't then it'll be a few hundred maybe.
Spend the cash to keep jobs that will go otherwise in a strategically important industry? Where cash to preserve the jobs is less than the hit of not doing so? Its the 1970s redux.
If he gives us cash we will put it in the bank...
I would expect it to be in voucher form with no cash value
In that case, grocery shopping.
I am not going to go out and buy stuff I do not need just because somebody gave me a voucher
I doubt it will work in a supermarket. There will definitely be an aftermarket for the vouchers, you could probably sell it to someone else quite easily unless it needs to be presented with a photo ID.
If it is transferable I will give it to my daughters. I have everything I want or need.
Impressive that the £1k furlough back to work bonus wasn't leaked before today. That is a massive boost to the economy getting people actually back to work and I'm amazed that wasn't trailled in the press beforehands.
This is one very worried government, to be hosing all this dosh around to bribe firms to keep people in work. Rightly worried, of course. But these are unbelievably expensive sticking-plasters.
The £1k furlough bonus is politically clever. A sizable amount of cash to offer, and if companies fold before they take it it deflects the blame onto them.
Don't really see the logic myself. £1k isn't going to change their decision, so feels like just a bonus for those whose staff would have been kept anyway.
This is one very worried government, to be hosing all this dosh around to bribe firms to keep people in work. Rightly worried, of course.
Nobody sane can say they're not taking this seriously.
I've never been more grateful that we didn't elect Corbyn though. Can you imagine what Corbyn would have done if he and McDonnell were in Downing Street? Anything that moved would be nationalised under the guise of bailing them out.
Sunak has done well so far in the job, he's come across as suited to the role and spoken eloquently about the difficulties we face.
The problem is that all his department has done so far his spend money, to the point where we are looking at an annual deficit to make 2009 cry. At some point, he's going to have to cut spending and raise taxes, or find a way to introduce a big dose of inflation into the economy, that's when life gets more difficult for him.
That said, he deserves our best wishes, there's no easy way out from where we are now.
Quantitative Easing.
The Bank has printed £300bn this year which means in reality how much is our deficit this year? Also prevents deflation and adds a bit of much needed inflation into the country.
What's going to matter more is future years. The deficit will have to close again, not this year but before too long.
Fundamentally we're going to have to keep tipping cash into circulation to keep large parts of the economy open. Will be a long term problem to manage that is less bad than the immediate short term contraction of money stopping circulating. If we get the suggested £1,500 in Sunak tokens (2 adults 2 kids) then I'll go and spend £1,500 in tokens in the bits of the economy they are intended for. If we don't then it'll be a few hundred maybe.
Spend the cash to keep jobs that will go otherwise in a strategically important industry? Where cash to preserve the jobs is less than the hit of not doing so? Its the 1970s redux.
If he gives us cash we will put it in the bank...
Why would you do that, at 0%? Even Premium Bonds would be better,
Bank = "Anything that is not a cash register or checkout".
The £1k furlough bonus is politically clever. A sizable amount of cash to offer, and if companies fold before they take it it deflects the blame onto them.
Don't really see the logic myself. £1k isn't going to change their decision, so feels like just a bonus for those whose staff would have been kept anyway.
I think it may help tip a lot of edge cases into the keep column instead of the redundancy column. It's not going to be black and white.
The Bryn Glas tunnels in Newport. A notorious bottle beck on the M4 the motorway between S Wales and Bristol/London.
Drakeford canned a motorway by pass. Boris was implying he might override Drakeford I guess.
Can he do that? Constitutionally I mean.
Dunno tbh. But I guess you could just amend the devolution act if he really wanted to go nuclear to get the by pass built.
The whole things been a clusterf*** for years and years here, and pre Corona it was a car park every morning and evening and it’s the prime route by far for the Welsh economy. Now post COVID traffic has plunged. For how long and how much is the question now as the calculations on traffic flows would need to be redone I assume.
This is one very worried government, to be hosing all this dosh around to bribe firms to keep people in work. Rightly worried, of course. But these are unbelievably expensive sticking-plasters.
Very expensive, but the view is going to be that once someone loses their job, that £1k is spent very quickly by the government on benefits which may persist for years in some cases. They don't need that many fewer unemployed at the margins to save the £9bn overall.
This is one very worried government, to be hosing all this dosh around to bribe firms to keep people in work. Rightly worried, of course.
Nobody sane can say they're not taking this seriously.
I've never been more grateful that we didn't elect Corbyn though. Can you imagine what Corbyn would have done if he and McDonnell were in Downing Street? Anything that moved would be nationalised under the guise of bailing them out.
I don't see the £1,000 making much difference to be honest. But I really like the apprenticeship money and the fact that it has also been made available for over-25s. That is a very strong policy.
Doesn’t a 1K bonus just incentivise companies to keep employees until January and then fire them
No, the whole point is to keep people in employment and generate an economic recovery. If the news of the vaccine trials working are true then tiding employment over until January might be all we need.
This is one very worried government, to be hosing all this dosh around to bribe firms to keep people in work. Rightly worried, of course. But these are unbelievably expensive sticking-plasters.
Corbyn-esque levels of spending....
How ironic that PB Tories used to have this as an economic disaster scenario (until their own Chancellor adopted it)
"Fate, it seems, is not without a sense of irony..." - Morpheus
Impressive that the £1k furlough back to work bonus wasn't leaked before today. That is a massive boost to the economy getting people actually back to work and I'm amazed that wasn't trailled in the press beforehands.
I've been calling for that here. That's a massive boost to the bottom line for a struggling sector.
That's literally the policy we were talking about in here, VAT cuts on consumer goods has never made sense for a country that doesn't manufacture its own consumer goods.
Doesn’t a 1K bonus just incentivise companies to keep employees until January and then fire them
No, the whole point is to keep people in employment and generate an economic recovery. If the news of the vaccine trials working are true then tiding employment over until January might be all we need.
That doesn’t dispute what I said. This policy will be so easily abused, keep a worker on for a few months get a free bonus then fire them.
I've been calling for that here. That's a massive boost to the bottom line for a struggling sector.
That's literally the policy we were talking about in here, VAT cuts on consumer goods has never made sense for a country that doesn't manufacture its own consumer goods.
This is one very worried government, to be hosing all this dosh around to bribe firms to keep people in work. Rightly worried, of course.
Nobody sane can say they're not taking this seriously.
I've never been more grateful that we didn't elect Corbyn though. Can you imagine what Corbyn would have done if he and McDonnell were in Downing Street? Anything that moved would be nationalised under the guise of bailing them out.
Or they might actually have spent less than a Tory government
Doesn’t a 1K bonus just incentivise companies to keep employees until January and then fire them
No, the whole point is to keep people in employment and generate an economic recovery. If the news of the vaccine trials working are true then tiding employment over until January might be all we need.
If the job / employer are no longer viable a grand won't save it. But they can say "we offered cash"
Starmer Q1: You're blaming care workers Johnson A1: I take responsibility myself, I pay tribute to care workers Starmer Q2: You're blaming care workers Johnson A2: I pay tribute to care workers and we are investing in care homes Starmer Q3: You're blaming care workers, what do you say to them? Johnson A3: I pay tribute to care workers and we are investing in care homes
Except he's not taking responsibility himself. He's blaming care workers.
Except he's not, he literally said "I take fully responsibility".
Ah, I see.
So saying "I take responsibility" means he's taken responsibility.
What a lovely world you live in. It's like Camberwick Green!
Doesn’t a 1K bonus just incentivise companies to keep employees until January and then fire them
No, the whole point is to keep people in employment and generate an economic recovery. If the news of the vaccine trials working are true then tiding employment over until January might be all we need.
That doesn’t dispute what I said. This policy will be so easily abused, keep a worker on for a few months get a free bonus then fire them.
Your thinking is two dimensional. By keeping people in work and generating an economic recovery in the fourth quarter there would be no reason to sack anyone in January. It's trying to jump start a jobs based virtuous circle recovery. It's a policy which is very cheap for what it is trying to achieve.
Doesn’t a 1K bonus just incentivise companies to keep employees until January and then fire them
No, the whole point is to keep people in employment and generate an economic recovery. If the news of the vaccine trials working are true then tiding employment over until January might be all we need.
That doesn’t dispute what I said. This policy will be so easily abused, keep a worker on for a few months get a free bonus then fire them.
If a company does that they will own it.
Why would the company do that if they're trading successfully following reopening and the worker is doing productive work?
How on earth does labour respond to this other than too little too late
No wealth tax for the rich, money given to employers (spit!) and landlords (spit!) rather than to hard working people? How does the Chancellor propose to pay for all this largesse, how many valuable public services are going to have to be cut?
But yeah, good luck to Starmer, not easy to oppose that one.
Starmer Q1: You're blaming care workers Johnson A1: I take responsibility myself, I pay tribute to care workers Starmer Q2: You're blaming care workers Johnson A2: I pay tribute to care workers and we are investing in care homes Starmer Q3: You're blaming care workers, what do you say to them? Johnson A3: I pay tribute to care workers and we are investing in care homes
Except he's not taking responsibility himself. He's blaming care workers.
Except he's not, he literally said "I take fully responsibility".
Ah, I see.
So saying "I take responsibility" means he's taken responsibility.
What a lovely world you live in. It's like Camberwick Green!
The PB Tory thing was a tim/mickpork gag. They were clever and witty enough to make it (sometimes) funny.
You, Mr Senator, are no mickpork and also have failed to notice that most pb tories aren't any more, anyway, and that analyses of pmq have been scrupulously fair ever since sks took over. So, OK, you think pbtories are thick and prejudiced, but could we just take that as read from here on in?
This is one very worried government, to be hosing all this dosh around to bribe firms to keep people in work. Rightly worried, of course.
Nobody sane can say they're not taking this seriously.
I've never been more grateful that we didn't elect Corbyn though. Can you imagine what Corbyn would have done if he and McDonnell were in Downing Street? Anything that moved would be nationalised under the guise of bailing them out.
You’ll never know the answer to that it’s pure speculation.
Would it be easier for an opposition to cross examine Rishi Sunak from the right than from the left?
A right leaning opposition could stand up and say Sunak is consigning our grandchildren to a future of destitution deprivation and penury. What selfishness, what self obsession, what rank recklessnes!
It could tear into him for super wasteful spending on pet socialist projects blah blah blah.
Many of us here called for it, it's 50p-75p off a pint.
Or if pubs keep their prices the same its an extra 50-75p onto their bottom line off a pint. Which means they can trade more successfully even with a slower business and social distancing.
Doesn’t a 1K bonus just incentivise companies to keep employees until January and then fire them
No, the whole point is to keep people in employment and generate an economic recovery. If the news of the vaccine trials working are true then tiding employment over until January might be all we need.
If the job / employer are no longer viable a grand won't save it. But they can say "we offered cash"
No bit jobs aren't going to fall into the simple columns of viable and not viable though. Almost all of them will fall in the middle somewhere and an inducement will hopefully push the threshold for retaining someone a bit higher and help generate an economic recovery.
This is one very worried government, to be hosing all this dosh around to bribe firms to keep people in work. Rightly worried, of course.
Nobody sane can say they're not taking this seriously.
I've never been more grateful that we didn't elect Corbyn though. Can you imagine what Corbyn would have done if he and McDonnell were in Downing Street? Anything that moved would be nationalised under the guise of bailing them out.
You’ll never know the answer to that it’s pure speculation.
Its more than just speculation. We know what they wanted to nationalise even at the best of times.
Some interesting ideas from Sunak, but it is tinkering around the edges. The best that what he has announced will deliver is a few marginal gains. He'll get some great headlines though - which may make what is coming worse.
No I think it was probably a Johnson victory on balance. But Johnson isn’t at all “good” like Tories here would have you believe.
He’s a poor Commons performer and a poor orator. End of story.
Starmer can be good, Johnson never has been. Johnson has only ever won when Starmer had an off day and was perceived as the least bad, Johnson never delivered a killer blow.
OK, fair enough. And, yes, not to worry. Even the blind squirrel occasionally stumbles over a nut.
Who was trailing this £500 voucher? All I saw was that some think tank or other had proposed it. Perhaps I don't read the right papers.
If I was the opposition, I'd try and push a rumour of such a thing just to make sure everyone was disappointed with the actual announcements. It wouldn't be hard to do.
Would it be easier for an opposition to cross examine Rishi Sunak from the right than from the left?
A right leaning opposition could stand up and say Sunak is consigning our grandchildren to a future of destitution deprivation and penury. What selfishness, what self obsession, what rank recklessnes!
It could tear into him for super wasteful spending on pet socialist projects blah blah blah.
Doesn’t a 1K bonus just incentivise companies to keep employees until January and then fire them
No, the whole point is to keep people in employment and generate an economic recovery. If the news of the vaccine trials working are true then tiding employment over until January might be all we need.
That doesn’t dispute what I said. This policy will be so easily abused, keep a worker on for a few months get a free bonus then fire them.
Your thinking is two dimensional. By keeping people in work and generating an economic recovery in the fourth quarter there would be no reason to sack anyone in January. It's trying to jump start a jobs based virtuous circle recovery. It's a policy which is very cheap for what it is trying to achieve.
There is a "stickiness" to jobs - and the structures within companies that employers form.
The point about the furlough was to not break through that, by keeping people rather than firing them.
This means a larger chance that the company can come back to something like normal operation, and faster. Which in turn helps the companies it deals with, owes money to etc.
The bonus is to create a financial incentive (but not too large) to keep people through the initial pain as things start up.
Many of us here called for it, it's 50p-75p off a pint.
Yes - that was my first calculation
It would be a really good idea to keep that 5% rate permanently, would make a big difference to people evaluating domestic vs foreign holidays for example, as well as encouraging eating out and using pubs vs supermarket drinks.
Doesn’t a 1K bonus just incentivise companies to keep employees until January and then fire them
No, the whole point is to keep people in employment and generate an economic recovery. If the news of the vaccine trials working are true then tiding employment over until January might be all we need.
That doesn’t dispute what I said. This policy will be so easily abused, keep a worker on for a few months get a free bonus then fire them.
Your thinking is two dimensional. By keeping people in work and generating an economic recovery in the fourth quarter there would be no reason to sack anyone in January. It's trying to jump start a jobs based virtuous circle recovery. It's a policy which is very cheap for what it is trying to achieve.
There is a "stickiness" to jobs - and the structures within companies that employers form.
The point about the furlough was to not break through that, by keeping people rather than firing them.
This means a larger chance that the company can come back to something like normal operation, and faster. Which in turn helps the companies it deals with, owes money to etc.
The bonus is to create a financial incentive (but not too large) to keep people through the initial pain as things start up.
Yes, all the support is helping the recovery be V-shaped rather than U-shaped.
Some interesting ideas from Sunak, but it is tinkering around the edges. The best that what he has announced will deliver is a few marginal gains. He'll get some great headlines though - which may make what is coming worse.
Its not just tinkering.
A 15% cut in VAT is absolutely mammoth for hospitality. Especially for food - since there's no input VAT on raw food, VAT hits the entire bill for hospitality businesses. Either hospitality can cut prices now and/or more they can pocket some of this to pad out the bottom line thus keeping their employees in work and allowing a recovery.
This is one very worried government, to be hosing all this dosh around to bribe firms to keep people in work. Rightly worried, of course.
Nobody sane can say they're not taking this seriously.
I've never been more grateful that we didn't elect Corbyn though. Can you imagine what Corbyn would have done if he and McDonnell were in Downing Street? Anything that moved would be nationalised under the guise of bailing them out.
You’ll never know the answer to that it’s pure speculation.
Its more than just speculation. We know what they wanted to nationalise even at the best of times.
You haven’t got a clue how he would have responded in the face of the current crisis as I say pure speculation.
Would it be easier for an opposition to cross examine Rishi Sunak from the right than from the left?
A right leaning opposition could stand up and say Sunak is consigning our grandchildren to a future of destitution deprivation and penury. What selfishness, what self obsession, what rank recklessnes!
It could tear into him for super wasteful spending on pet socialist projects blah blah blah.
All labour can say is good on yah, son
The Lib Dems could do that, I suppose.
I don;'t think anybody WILL do it, to be honest, but I just wondered if it would be easier to.
Nope, not that one. Germany cut the VAT rate, what Sunak has announced is target relief at certain industries and products, which is most definitely not allowed under EU rules. See Tampons and domestic fuel for examples.
Starmer Q1: You're blaming care workers Johnson A1: I take responsibility myself, I pay tribute to care workers Starmer Q2: You're blaming care workers Johnson A2: I pay tribute to care workers and we are investing in care homes Starmer Q3: You're blaming care workers, what do you say to them? Johnson A3: I pay tribute to care workers and we are investing in care homes
Except he's not taking responsibility himself. He's blaming care workers.
Except he's not, he literally said "I take fully responsibility".
Ah, I see.
So saying "I take responsibility" means he's taken responsibility.
What a lovely world you live in. It's like Camberwick Green!
Yes it does.
Decided to give you a chance here but if you don't take it this is going on the list.
Does just saying "I take responsibility" mean that a person has in fact taken responsibility?
Some interesting ideas from Sunak, but it is tinkering around the edges. The best that what he has announced will deliver is a few marginal gains. He'll get some great headlines though - which may make what is coming worse.
Its not just tinkering.
A 15% cut in VAT is absolutely mammoth for hospitality. Especially for food - since there's no input VAT on raw food, VAT hits the entire bill for hospitality businesses. Either hospitality can cut prices now and/or more they can pocket some of this to pad out the bottom line thus keeping their employees in work and allowing a recovery.
It means very little if they are not open or people are not visiting, though. As I say, these are interesting ideas, but they are not going to make a huge amount of difference.
Nope, not that one. Germany cut the VAT rate, what Sunak has announced is target relief at certain industries and products, which is most definitely not allowed under EU rules. See Tampons and domestic fuel for examples.
He's moving them to the lower rate of 5%, which he could do under EU VAT rules (as indeed was announced for tampons and domestic fuel). He can't zero rate under EU rules.
Many of us here called for it, it's 50p-75p off a pint.
Yes - that was my first calculation
It would be a really good idea to keep that 5% rate permanently, would make a big difference to people evaluating domestic vs foreign holidays for example, as well as encouraging eating out and using pubs vs supermarket drinks.
Eating out has always been punitively taxed by VAT.
Buy a supermarket pizza and there is 0% VAT on it. Buy a restaurant/takeout one and 20% VAT is slapped onto it.
I don't see why supermarkets need to be incentivised by the tax system like that.
Nope, not that one. Germany cut the VAT rate, what Sunak has announced is target relief at certain industries and products, which is most definitely not allowed under EU rules. See Tampons and domestic fuel for examples.
We're still following EU law, so anything we can do now, we could have done without Brexit.
Some interesting ideas from Sunak, but it is tinkering around the edges. The best that what he has announced will deliver is a few marginal gains. He'll get some great headlines though - which may make what is coming worse.
Its not just tinkering.
A 15% cut in VAT is absolutely mammoth for hospitality. Especially for food - since there's no input VAT on raw food, VAT hits the entire bill for hospitality businesses. Either hospitality can cut prices now and/or more they can pocket some of this to pad out the bottom line thus keeping their employees in work and allowing a recovery.
It means very little if they are not open or people are not visiting, though. As I say, these are interesting ideas, but they are not going to make a huge amount of difference.
Yep, the politicians and media are utterly deluding themselves if they think this sort of thing will make a blind bit of difference.
Starmer Q1: You're blaming care workers Johnson A1: I take responsibility myself, I pay tribute to care workers Starmer Q2: You're blaming care workers Johnson A2: I pay tribute to care workers and we are investing in care homes Starmer Q3: You're blaming care workers, what do you say to them? Johnson A3: I pay tribute to care workers and we are investing in care homes
Except he's not taking responsibility himself. He's blaming care workers.
Except he's not, he literally said "I take fully responsibility".
Ah, I see.
So saying "I take responsibility" means he's taken responsibility.
What a lovely world you live in. It's like Camberwick Green!
Yes it does.
Decided to give you a chance here but if you don't take it this is going on the list.
Does just saying "I take responsibility" mean that a person has in fact taken responsibility?
Doesn’t a 1K bonus just incentivise companies to keep employees until January and then fire them
It will get some through Christmas, which is no bad thing.
And by the time January rolls around we should be well into a recovery so no need to sack anyone and potentially bringing more people back.
I am not sure it will work like that, unfortunately.
I don't see why it wouldn't.
Because in the great scheme of things £1,000 is not a huge amount. You'd generally keep someone on anyway if that was the only issue. It may help a few smaller busiensses which are very dependent on cashflow, but I suspect that most businesses will be looking at a longer term horizon than January. I know we are.
Comments
£1k isn't going to change their decision, so feels like just a bonus for those whose staff would have been kept anyway.
They should have been part of the Second Severn Crossing scheme.
Fixing this one goes alongside fixing the A303 at Stonehenge as the best value road project possible.
I've never been more grateful that we didn't elect Corbyn though. Can you imagine what Corbyn would have done if he and McDonnell were in Downing Street? Anything that moved would be nationalised under the guise of bailing them out.
The whole things been a clusterf*** for years and years here, and pre Corona it was a car park every morning and evening and it’s the prime route by far for the Welsh economy. Now post COVID traffic has plunged. For how long and how much is the question now as the calculations on traffic flows would need to be redone I assume.
I've been calling for that here. That's a massive boost to the bottom line for a struggling sector.
Many of us here called for it, it's 50p-75p off a pint.
How ironic that PB Tories used to have this as an economic disaster scenario (until their own Chancellor adopted it)
"Fate, it seems, is not without a sense of irony..." - Morpheus
Sunak's defining moment according to Rishi.
State intervention and spending on a scale he could only dream of!
So saying "I take responsibility" means he's taken responsibility.
What a lovely world you live in. It's like Camberwick Green!
It is getting too surreal around here.
Later peeps!
Why would the company do that if they're trading successfully following reopening and the worker is doing productive work?
Silly gimmick that one unless there's more to it that I've not seen. Should have just done the £1000 etc
But yeah, good luck to Starmer, not easy to oppose that one.
You, Mr Senator, are no mickpork and also have failed to notice that most pb tories aren't any more, anyway, and that analyses of pmq have been scrupulously fair ever since sks took over. So, OK, you think pbtories are thick and prejudiced, but could we just take that as read from here on in?
A right leaning opposition could stand up and say Sunak is consigning our grandchildren to a future of destitution deprivation and penury. What selfishness, what self obsession, what rank recklessnes!
It could tear into him for super wasteful spending on pet socialist projects blah blah blah.
All labour can say is good on yah, son
It's always best politically to do things the public / media will understand - people will talk about them and the message then spreads.
Big picture message politically is he is really doing specific things.
https://www.telegraph.co.uk/business/2020/06/04/germany-launches-130bn-stimulus-kickstart-economy/
If I was the opposition, I'd try and push a rumour of such a thing just to make sure everyone was disappointed with the actual announcements. It wouldn't be hard to do.
The point about the furlough was to not break through that, by keeping people rather than firing them.
This means a larger chance that the company can come back to something like normal operation, and faster. Which in turn helps the companies it deals with, owes money to etc.
The bonus is to create a financial incentive (but not too large) to keep people through the initial pain as things start up.
A 15% cut in VAT is absolutely mammoth for hospitality. Especially for food - since there's no input VAT on raw food, VAT hits the entire bill for hospitality businesses. Either hospitality can cut prices now and/or more they can pocket some of this to pad out the bottom line thus keeping their employees in work and allowing a recovery.
https://www.theguardian.com/commentisfree/2020/jul/08/lockdown-pointing-finger-rule-breakers-britons-pints
@contrarian one for you especially but every word is spot on imo.
Does just saying "I take responsibility" mean that a person has in fact taken responsibility?
Buy a supermarket pizza and there is 0% VAT on it.
Buy a restaurant/takeout one and 20% VAT is slapped onto it.
I don't see why supermarkets need to be incentivised by the tax system like that.
FDR joke the buck stops here was already answered in PMQs