Treasury could give adults £500 to spend in COVID affected industries

Oxford Street 2020
Oxford Street, June 2020 Image: ©TheIndustry.fashion

The UK chancellor Rishi Sunak is reportedly considering giving vouchers worth £500 to adults and £250 to children to boost spending in parts of the economy that have been badly hit by the Coronavirus pandemic.

The plan has been drawn up by independent British think tank Resolution Foundation, which has already held talks with the Treasury about the idea, reports The Guardian.

“The proposal, which forms part of wider fiscal stimulus package put forward by the Foundation, would involve the delivery of up to £30 billion worth of consumption vouchers for households to spend in the areas of the economy being hardest hit, such as face-to-face retail and hospitality,” the think tank said in a statement.

The proposals are similar to successful schemes already used in China, Taiwan and Malta. In April, the Chinese city of Wuhan, where the COVID-19 outbreak is believed to have originated, issued £57 million in consumption vouchers for use in restaurants, shopping centres, and cultural, sports and tourist venues.

The move would be designed to kickstart a financial recovery by initiating a targeted surge in consumer spending in specific industries.

The vouchers would not be able to be spent online, only in physical retail stores and hospitality locations.

The report from The Guardian confirmed that the Treasury did not rule out introducing such a scheme and quotes sources as saying it might opt for smaller sums if it does decide to introduce it.

Sunak is expected to make announcements on the next stage of the plan to secure Britain’s recovery on Wednesday 8 July.

Last week, TheIndustry.fashion reported that the rapid recovery in high street sales in the first week after non-essential stores were allowed to reopen tapered off in the following days.

Sales were around a fifth lower than last year in the first two weeks of last month, but rebounded to only 7.1% down after 15 June, when non-essential shops were allowed to reopen.

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