Tax cuts and traineeships build Treasury’s coronavirus recovery kickstart scheme

The UK government is set to unveil a £2 billion “kickstart scheme” to help unemployed young people into work.

As part of the wider coronavirus recovery plan, the fund will be used to subsidise work placements for 16 to 24-year-olds who are claiming universal credit.

Each candidate will be covered for six-months work of up to 25 hours work per week at National Minimum Wage, which employers can top up if they see fit.

The scheme is open to applicants from England, Scotland and Wales, and additional funding is set to be provided to Northern Ireland to set up its own programme.

In England, the government has pledged to create 30,000 traineeships for young people, incentivising employers with a £1,000 per placement.

The UK’s young job seekers stand to be disproportionately affected by the pandemic, as they are two and half times more likely to work in sectors hit hardest by the crisis than those in other age groups.

Nicholas Watt, political editor at BBC’s Newsnight, also said the chancellor may introduce a temporary VAT cut to help those in the hospitality sector to get back on their feet.

The plan has been welcomed by The Trades Union Congress (TUC), which has been campaigning for government intervention to help protect the UK’s young job seekers.

In a statement, the TUC said: “The kickstart scheme is a good first step. But we'll be checking the small print to ensure every job provides proper training and a bridge to steady employment.”

It also suggested that government should assemble a “national recovery council” of businesses and unions to “ensure we build back better, right across the country.”

British Chambers of Commerce (BCC) also welcomed the scheme, and said government had responded to its campaigning to prioritise work experience and job opportunities.

It stated: “The Chamber network stands ready to work with government on the detail of the scheme to ensure it is successfully delivered on the ground.

“This announcement must form part of a wider plan to boost business confidence and protect livelihoods as we restart, rebuild and renew the UK economy.”

Further details of the Treasury’s ‘plan for jobs’ are expected today in a statement from chancellor Rishi Sunak following Prime Minister’s Questions.