Chancellor lays down gauntlet

Holyrood urged to invest in tartan jobs deal

Cockburn Street Edinburgh pubs

Pubs and restaurants will get a tax break (pic: Terry Murden)

The Scottish Government has been urged to use additional funding from the Treasury to invest in creating jobs and cutting the cost of buying a home.

Chancellor Rishi Sunak set out a plan to underpin employment as Britain emerges from the devastation caused by the coronavirus.

A headline-grabbing temporary cut in VAT from 20% to 5%, and a catchy scheme offering discounted meals at restaurants, is aimed at supporting the hard-hit hospitality industry.

There are new subsidies to ensure young furloughed workers are retained by companies, and cuts to the cost of buying a home in England and Northern Ireland.

The UK Government is now providing the Scottish Government with a total of £4.6 billion in extra support through the Barnett formula. Scotland’s share of the overall spending is £800m, while the Scottish government says it receives an additional £21m.

Delivering his summer economic update, Mr Sunak said: “Our plan has a clear goal: to protect, support and create jobs. It will give businesses the confidence to retain and hire. To create jobs in every part of our country. To give young people a better start. To give people everywhere the opportunity of a fresh start.”

Rishi Sunak

Rishi Sunak: ‘strengthening the union’

Mr Sunak said the plan for jobs was the second of a three-phase plan to secure the UK’s economic recovery from coronavirus.

The first phase, beginning in March, focused on protection with a £160bn package of support – one of the largest and most comprehensive economic responses in the world. In Scotland this package has so far protected more than 620,000 jobs, helped thousands of businesses and paid £425 million to 146,000 self-employed people.

The Chancellor said that following the second phase focusing on jobs, there would be a third phase focusing on rebuilding, with a Budget and Spending Review in the autumn.

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