Boris Johnson’s budget to fire up UK: PM is preparing a ‘Great Recovery Bill’ to slash red tape and get Britain’s economy moving again – alongside a mini-budget set for July
- Boris Johnson is drawing up ‘Great Recovery Bill’ to help flailing businesses
- Downing St is asking Ministers about reforms to get economy moving again
- A ‘mini-budget’ is expected to be announced in July – including tax cuts
- Chancellor Rishi Sunak considering a national insurance holiday for employers
Boris Johnson is drawing up a ‘Great Recovery Bill’ to slash red tape and help get the economy moving again.
Ministers have been told to submit ideas for reforms that would allow firms to adapt to the pandemic upheaval.
They are also being asked to find ways of ensuring essential services can operate while social distancing remains in place.
The plans would be rolled together in a legislative agenda provisionally entitled the ‘Great Recovery Bill’. It will sit alongside a mini-budget, pencilled in for July, which is expected to include tax cuts to fuel consumer spending and business investment.
Chancellor Rishi Sunak, who is under pressure to temporarily lower VAT and stamp duty, is considering a national insurance holiday for employers to boost jobs.
Mr Johnson’s shake-up could include major reforms to the planning system to revive his ‘infrastructure revolution’, which has stalled during the lockdown. Ministers believe new housing, roads and broadband will be central to any recovery.
Boris Johnson is drawing up a ‘Great Recovery Bill’ to slash red tape and help get the economy moving again, and is asking Ministers to submit ideas that will prop up firms following the pandemic’s upheaval of the economy
Plans to create a network of ‘freeports’, where normal tax and customs rules do not apply, are also set to be fast-tracked.
A Government source said: ‘Departments are being asked to identify the things they need to keep services going, but also the changes that would free up the economy and get business moving again once we start to open up.
‘The idea is to then put them all into one big piece of legislation that helps get the recovery going.’
The Prime Minister’s plan comes as:
- Cases of coronavirus in the community fell by 30 per cent last week to 5,600 a day;
- Health Secretary Matt Hancock said all hospital patients, visitors and staff will have to wear masks from June 15;
- He urged people to stay away from George Floyd protests to avoid spreading the virus;
- The UK death toll rose by 357 to pass 40,000 – only the United States has recorded more fatalities;
- The virus’s transmission rate – or R number – is creeping up dangerously in the North West and South West;
- Deaths in care homes went up by 60 per cent compared with normal levels in the first week of the pandemic;
- Churches will be allowed to reopen for private prayer this month;
- The anti-malarial drug hailed as a miracle virus cure by Donald Trump is ‘useless’, a British study concluded;
- British Airways threatened legal action against the Government over its quarantine plan for travellers entering the UK.
Chancellor Rishi Sunak, who is under pressure to temporarily lower VAT and stamp duty, is considering a national insurance holiday for employers to boost jobs
Some of the red tape that ministers will target can be ditched without the need for primary legislation. They are already considering scrapping local authority fees for cafes and restaurants that want to put tables on the pavement.
But other changes will require primary legislation and have prompted the idea of a wide-ranging new law.
The Department for Education is assessing whether further legal changes may be needed to allow a full return to school in September, when social distancing is expected to make normal classes difficult.
And the Ministry of Justice is considering whether to allow juries to sit with fewer than 12 members in order to allow for social distancing in court.
The Prime Minister is calling for a ‘green recovery’ and new investment is expected in electric vehicles and battery technology to help the ailing car industry.
Government sources have indicated that despite the dire impact of the lockdown on the public finances, which could see the deficit soar to more than £300billion this year, Mr Sunak is keen to cut taxes.
One idea is a national insurance holiday for employers, which experts believe could save hundreds of thousands of jobs and stimulate investment.
But Mr Sunak is also under pressure to cut personal taxes to revive collapsed consumer demand and directly put money into the pockets of families.
Former Labour and Tory chancellors Lord Darling and Philip Hammond this week backed calls for a temporary VAT cut.
Mr Hammond said there was ‘no economic logic to increasing taxes in the short term’, adding: ‘The question is as we move more deeply into the recovery phase, there may be a need for some short-term fiscal stimulus to the economy and that could be delivered most obviously through tax cuts.’