Since the start of the crisis this government has taken extensive and unprecedented action to tackle Covid-19 and mitigate these impacts across all areas of the UK, investing over £280billion to protect jobs and livelihoods. Providing the funding necessary to respond to the virus is the right thing to do: as the OBR set out, “the costs of inaction would certainly have been higher”.
SR20 builds on this action, confirming an additional £38 billion for public services to continue to fight the pandemic this year, bringing total support to over £113 billion in 2020-21 It also provides a further £55 billion of support for the response to Covid-19 next year, targeted to control and suppress the virus, increase support to public services and support jobs and businesses.
How is SR20 targeting support at controlling and suppressing the virus?
- £15 billion for Test and Trace: to maintain the testing capacity, continue contact tracing and ramp up provision of rapid turnaround tests to regularly test NHS and Social Care workers.
- £3 billion to support the NHS to recover from the impacts of Covid-19 including around £1 billion to begin tackling the elective backlog; around £500 million for mental health services and workforce investment; and £1.5 billion to help ease existing pressures in the NHS caused by Covid-19.
- In 21-22 we are committing an additional £733 million for the purchase of successful Covid-19 vaccines, and £128 million to support vaccines R&D, including clinical trials, and UK manufacturing capacity. This takes the total provision for Covid-19 vaccines to over £6 billion.
- £2.14 billion to purchase and distribute PPE, sufficient funding to meet expected demand and maintain a 4-month stockpile across 2021-22.
- £163 million for Covid-19 medicines.
What additional support are you providing public services impacted by covid-19?
SR20 builds on the substantial support provided to ensure that our public services can live with the virus while continuing to deliver first class services. This includes:
- Over £3 billion of additional support in 2021/22 to local authorities – on top of over £7 billion provided since March to help local authorities in England respond to the impacts of Covid-19. The £3billion includes £1.55 billion of grant funding to help LAs manage Covid-19 spending pressures across all services, £670million of hardship grant funding to support those who are least able to afford council tax payments, and reimbursement for income losses.
- £254million of additional resource funding, including £103million announced earlier this year for accommodation and substance misuse, to support rough sleepers and those at risk of homelessness during Covid-19. This takes total resource funding in 2021-22 to £676 million, a 60% cash increase compared to SR19.
- £87million of capital funding in 2021-22 primarily to support the delivery of long-term accommodation for rough sleepers.
- £80million additional funding to address backlogs in the Crown Court caused by Covid-19 and a further £76million to expand capacity in the Family Court and Employment Tribunal in England and Wales.
- £25million extra to support victims’ services across England and Wales, including for victims of domestic abuse – following the £15million provided at Budget 2020 – bringing the total to £40million next year.
How does SR20 support jobs?
£3.7 billion of additional funding is allocated to support frontline services and to enable DWP to deliver on July’s Plan for Jobs to support people back into work.
- A new Restart programme to provide intensive and tailored support to over 1 million unemployed people and help them find work in England and Wales, with approximately £400million investment in 2021-22. The first step in a £2.9 billion three-year programme.
- Investing £1.4billion to build on the Plan for Jobs commitment to increase capacity in Job Centre Plus and double the number of work coaches in Great Britain.
- Additional investments in Plan for Jobs measures including the Job Entry: Targeted Support and Job Finding Support schemes and the Youth Offer in Great Britain, as well as Sector-based Work Academy Programme placements in England and Scotland.
- This settlement also confirms a total package of £2 billion, with £1.6billion in 21/22 to continue creating up to 250,000 government-subsidised jobs through the Kickstart Scheme in Great Britain.
How does SR20 help businesses?
In addition to investing in the structures needed to control and mitigate the virus and put the economy on a path to recovery and supporting people to find jobs, SR20 also:
- Confirms £519 million of funding in 2021-22 to support the continued delivery of Covid-19 loans, including paying for the 12-month interest free period on the BBLS and the CBILS
- Freezes the business rates multiplier in 2021-22, saving businesses in England £575 million over the next five years.
- Provides £56.5 million in 2021-22 to fund an expansion of the British Business Bank’s Start-Up Loans scheme, which will deliver an additional 1,000 loans to help catalyse new entrepreneurship in the economic recovery from Covid-19.
How does SR20 provide investment in skills and training?
SR20 supports people back into work by investing in expanding opportunities through skills and training. £375million of new funding will be provided from the National Skills Fund, including:
- £127million to extend the Plan for Jobs measures to help adults build the skills they need to get into work, including funding for sector-based work academies and traineeships, and investment in the National Careers Service to enable more adults to access high quality careers advice;
- £138million for the PM’s Lifetime Skills Guarantee to fund in-demand technical courses for adults equivalent to A levels and expand the employer-led bootcamp training model.
Further support will also be provided to employers to offer apprenticeships by making £2.5 billion funding available and delivering new improvements including front-loading training, making the transfer of levy funds to SMEs easier, and supporting industries with more flexible working patterns. The apprenticeship hiring incentive scheme has also been extended to 31 March 2021 and pays employers £2,000 for apprentices hired aged under 25 and £1,500 for those aged 25 and over.
How does SR20 support people on welfare and low incomes?
- From April 2021, workers on the National Living Wage will receive a 2.2% pay increase to £8.91 an hour – worth £345 a year for a full-time worker.
- The government is also extending the NLW to those aged 23 or over (currently 25+).
- Young people and apprentices will also see increases in the National Minimum Wage rates on 1 April 2021.
- We will protect the lowest paid, with 2.1 million public sector workers earning less than £24,000 receiving a minimum £250 increase.
What are you providing for the devolved administrations?
We are providing the devolved administrations with £2.6billion of Covid-19 Barnett funding in 2021-22 (£1.3billion for the Scottish Government, £770million for the Welsh Government, £540million for the Northern Ireland Executive). This can be used by the devolved administrations to grow the economy, improve public services and support people and businesses across Scotland, Wales and Northern Ireland. This is on top of more than £60billion core funding for 2021-22 and additional to the £16billion resource funding guarantee provided for 2020-21.
People and businesses in Scotland, Wales and Northern Ireland also benefit from all the UK government programmes that apply UK-wide.