Public Policy

July 23, 2020

Covid-19 Recovery Brief: Thursday, July 23

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Each day, our Public Policy team will be reporting on the latest news in the evolving situation. To view the previous day’s summary, please click here.

The Chancellor, Rishi Sunak, has  launched the 2020 Comprehensive Spending Review (CSR)

  • The Review, to be published in the autumn, will set out how much Government Departments can spend until 2024.
    • There is no fixed amount that the Chancellor is promising to spend, but he did confirm that departmental spending will grow in real terms across the CSR period. HM Treasury will accept representations until 24 September 2020.
    • It came as the Government announced an above-inflation pay rise for 900,000 teachers, doctors and policemen, however it is reported that the Chancellor warned that public sector workers would have to accept far greater pay “restraint” in future.
    • This could mean that nurses and junior doctors who missed out on this year’s rises because they were already in multi-year pay deals could face tighter pay settlements next year. While even this year’s pay rises must come from Departments’ existing budgets.
    • It is reported that Sunak told departments to find chances to “reprioritise and deliver savings”, warning that these would be needed to pay for other spending. Asset sales should be considered and secretaries of state must “propose plans for relocating offices and arms-length bodies outside London”.
    • In an attempt to recover up to £8.5 billion of annual avoidable tax losses, all businesses as well as most landlords and the self-employed will have to file tax returns digitally by 2023.
    • Mr Sunak said that Whitehall budgets would still grow above the rate of inflation. However, he rowed back from a pledge made in his March budget to increase spending by £76 billion, or 9% in real terms, between now and 2023-24.
    • It comes as Government borrowing hit £127.9 billion in the first quarter of the financial year. £103.9 billion more than in the same period last year and more than in any full financial year on record, except 2009-10 and 2010-11.

Prime Minister, Boris Johnson, has announced a £350m package to cut emissions in heavy industry

  • The funding will help drive decarbonisation of heavy industry, construction, space and transport. The package includes:
    • £139 million to cut emissions in heavy industry by supporting the transition from natural gas to clean hydrogen power, and scaling up carbon capture and storage (CCS) technology which can stop over 90% of emissions being released from industrial plants into the air by storing carbon permanently underground.
    • £149 million to drive the use of innovative materials in heavy industry; the 13 initial projects will include proposals to reuse waste ash in the glass and ceramics industry, and the development of recyclable steel.
    • £26 million to support advanced new building techniques in order to reduce build costs and carbon emissions in the construction industry.
    • A £10 million boost for state of the art construction tech which will go towards 19 projects focused on improving productivity and building quality, for example, re-usable roofs and walls and “digital clones” of buildings that analyse data in real time.
    • Launching a New National Space Innovation Programme backed by £15 million initial funding from the UK Space Agency, which will see the first £10million go towards projects that will monitor climate change across the globe, which could protect local areas from the impacts of extreme weather by identifying changes in the environment.
    • Opening up bids for a further £10million for R&D in the automotive sector, to help companies take cutting edge ideas from prototype to market, including more efficient electric motors or more powerful batteries
    • The PM also launched the first meeting of Jet Zero Council, tasked with making net-zero emissions possible for future flights.

Other UK news

  • The Welsh government has announced an additional £50m in funding for Welsh universities and colleges. £27m will go to higher education institutions and £23m to FE colleges and sixth forms.
  • Full guidance on wearing face coverings in shops in England has been released, Coverings will be mandatory in enclosed public spaces including supermarkets, indoor shopping centres, transport hubs, banks and post offices. They must also be worn when buying takeaway food and drink, although they can be removed in a seating area. Face coverings will not be mandatory for anyone under the age of 11, or those with disabilities or certain health conditions.
  • The Northern Ireland Executive has announced a £10.5 million funding package to support the childcare sector.
  • The Department of Health and Social Care has published guidance on visits to care homes. Local directors of public health will lead the decision-making process for care home visits. Appropriate safety precautions will be required, including face coverings and social distancing measures.
  • The UK Government has pledged £40 million for the Falkirk Growth Deal to boost investment in the area. The deal will see funding directed towards potential projects to boost the local economy by creating skilled jobs and investing in infrastructure improvements to support sustainable travel, tourism and energy.
  • HM Treasury have announced that NHS doctors and dentists in England will receive a 2.8% pay rise, backdated to April 2020. Meanwhile teachers are set to receive their biggest pay rise in fifteen years with a 5.5% increase in the starting salary. The Government has also committed to increase the upper and lower boundaries of the pay ranges for all other teachers by 2.75%.
  • Housing Secretary Robert Jenrick has announced that, from September, full planning applications will not be required to demolish and rebuild unused buildings, as homes and commercial and retail properties can be quickly repurposed to help revive high streets and town centres.
  • Welsh Finance Minister Rebecca Evans has announced £1.4m in funding for services that help people in Wales struggling with restricted household income and problem debt in the wake of Covid-19.
  • The Government has signed deals for 90 million doses of two promising Covid-19 vaccines which are in development. The deal comes on top of the 100 million doses of the Oxford University vaccine previously secured.
  • The Government has announced that, from 18 July to 31 August, funds raised through selected COVID-19 charity campaigns will be matched pound-for-pound up to £85 million through the new ‘Community Match Challenge.’ The Voluntary and Community Sector Emergencies Partnership will receive £4.8 million to help strengthen the voluntary sector’s response to COVID-19 and future emergencies. The funding is part of the £750 million announced for frontline charities.
  • Schools in England will receive a £4.8bn boost in 2021 compared with 2019 with secondary and primary schools attracting a minimum of £5,150 and £4,000 respectively per pupil. This allocation forms the second part of this Government’s three year school funding settlement. Funding to cover increases to teacher pay and pensions worth £2 billion will also be included from 2021 rather than paid separately.
  • The Government has announced that temporary courts – called ‘Nightingale Courts’ – will begin hearing cases from next week, in an attempt to ease pressure on the courts system and tackle the number of outstanding cases.
  • Housing Secretary Robert Jenrick has launched a £266 million housing fund for vulnerable people. Councils and their local partners can apply for funds from the Government’s Next Steps Accommodation Programme to cover property costs and support new tenancies for around 15,000 vulnerable people who were provided with emergency accommodation during the pandemic.
  • Marks and Spencer is set to cut 950 jobs as part of a restructuring of its store operations
  • Sales of paint, wallpaper, plants and compost have soared during lockdown, the owner of B&Q and Screwfix has said. Like-for-like sales jumped by 21.6% in the three months to 18 July. Store re-openings also boosted revenue, while online sales more than tripled.
  • Parcel delivery firm Hermes is creating more than 10,000 jobs as it gears up to cope with the shift to home shopping during the pandemic.
  • Emirates has become the first airline in the world to guarantee to cover customers’ medical expenses if they are diagnosed with Covid-19.
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