Every adult would be given a ?150 voucher to spend in shops under a think tank's idea to boost the high street when lockdown ends. Every child would also be given ?75 under the ?9bn scheme being proposed by the Resolution Foundation. In a report today, the organisation says the voucher scheme should be part of a ?70bn programme later in the year including ?27bn for retraining and job support and ?18bn in green investment.
The think tank also says the current rate of Universal Credit - raised by ?20 a week during the pandemic - should be made permanent. However, it's understood there is zero chance of Chancellor Rishi Sunak announcing the voucher scheme any time soon - including in next week's Budget. Officials believe it would make no sense to announce such a scheme months in advance because it would change people's spending behaviour.(C) PA The Resolution Foundation suggested vouchers worth ?150 for adults and ?75 for children
And it would be difficult to set up sensibly because while some shops are on their knees due to Covid-19, others have done well from the pandemic.
Despite this, the Daily Mail said Treasury officials are looking at a dramatic recovery package later in the year - which could include vouchers as well as lower alcohol duty for pubs and restaurants battered by lockdown. The Chancellor is thought to be planning a Budget with four themes, "support, recovery, vision and honesty", which looks set to introduce some tax rises to start paying for the pandemic. Support schemes such as furlough and the ?20-a-week Universal Credit uplift also look set to be extended temporarily.
The think tank's report, 'How to throw good money after good', suggests ways to top up the ?280bn already committed to Covid to help the British economy recover.(C) REUTERS The Chancellor is thought to be planning a Budget with four themes,
It argues: "These vouchers could be spent in physical non-food retail, where there is more likelihood that consumption is likely to re-bound more slowly than in other services such as pubs and restaurants. "This is likely to be the case, with more survey respondents reporting plans to increase their spending on restaurants and pubs after the pandemic than decrease spending. "But roughly equal proportions of respondents suggesting they would increase or decrease their spending on clothes and other retail.
"This temporary voucher scheme would slow but not halt the longer-term trend towards online retail." James Smith, Research Director at the Resolution Foundation, said: "The Chancellor is approaching his second Budget at a pivotal moment for the economy, with the country likely to emerge out of the biggest economic downturn in over three centuries in the coming months. "But while in the US debate has focused on President Biden's ?1.9 trillion stimulus plan, the UK debate has got stuck on how to withdraw support.
"Instead, the Chancellor should combine extending existing support with fresh stimulus once restrictions are lifted to deliver a ?100 billion plan to boost Britain's recovery.
"That is the scale of ambition needed to increase the chances that Britain sees a strong recovery from its pandemic-induced slump, and to ensure the recovery reaches firms and families across the UK."