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Industry Reaction to Chancellor Rishi Sunak’s Summer Statement

On Wednesday, UK Chancellor Rishi Sunak announced a whole raft of packages which he believed would “get the economy moving”, here industry leaders given an early reaction as to whether or not they think the ideas will land on the money.

Franz Doerr, founder and CEO of flatfair, said:

“For a mini-budget that was meant to unveil the government’s thinking about how to both protect and create jobs from the economic headwinds caused by Covid-19, it’s surprising that the Chancellor did not feel the need to elaborate on any further support for the UK’s tech sector.

“The UK’s tech sector has been booming over the last few years, and to not support it now during this time would risk erasing years of growth and job creation.

“Post-pandemic, the UK’s tech sector has the ability to play a key role in helping revive our economy through fostering innovation and creating jobs. Making sure it comes through this crisis in the best shape possible is vital.” 

On the cut in stamp duty:

Paul Stockwell, Chief Commercial Officer at Gatehouse Bank commented:

“We welcome the Chancellor’s announcement to help strengthen the housing market. The property market has rebounded since re-opening in May, but uncertainty surrounding house prices means many buyers have been tentative about committing.

“The stamp duty cut on homes up to £500,000 will be a valuable incentive to encourage more buyers to buy or move home, especially in property areas like London and the South East where stamp duty costs are high.

“Home movers have been less active than first-time buyers in the past year, but we may see this trend reverse as owners look to make significant savings when they upsize or downsize their property.”

David Westgate, Group Chief Executive, at Andrews Property Group, added:

“The Chancellor’s Stamp Duty holiday is high risk but a welcome short-term stimulus.

“While it puts more money into pockets today, it could actually see prices rise as demand increases. Making the much anticipated Stamp Duty cut temporary is a gamble if the economy hasn’t recovered by the Spring. It is possible that we will have a boom scenario between now and April next year when a disproportionate number of people are buying at higher prices followed by softer prices when the scheme ends and asking prices are adjusted.

“Arguably the real winners will be purchasers of higher value properties who have just had £15k knocked off their completion bill, not the people it was intended for. Cliff edge deadlines completely distort the market and rarely benefit the consumer.”

On ‘Eat Out to Help Out’

Professor of Accounting and Taxation at the University of Birmingham, Andy Lymer, said:

“The food voucher ‘Eat Out to Help Out’ scheme to support eating out in August does feel like it could be complicated for customers to use and particularly staff to work with (only for certain days of the week, can be used for soft drinks but not alcohol, only at ‘participating venues’, capped at £10 per head etc.). But the cut in VAT to 5% for the next six months for food, accommodation and attractions costs is clearly very welcome (albeit costly at £4.1bn) – although such a cut doesn’t directly put money in the pockets of these businesses of course – only indirectly by making prices cheaper and (hopefully) increasing sales therefore. Any help to this sector so badly hit over these last 3-months surely has to be welcomed even though other sectors similarly badly hit will feel aggrieved at missing out on this possible boost to sales a wider VAT reduction could have created.”

Matthew Stubbs is the CEO of BookingTek, which created the TableRes app. He said,

“This is welcome news from the Chancellor, at a time when many restaurants and pubs are in dire need of new customers to boost revenue. Key to this recovery process should also be the upgrading and installation of new technology, so that venues can offer speedy, safe and efficient service to people who are still fearful of the risks posed by the Covid-19 outbreak.

Stubbs continued, “This is easily achieved with contactless technology like order-pay mobile apps. They facilitate touchless payments, as well as enabling customers to order food and drinks via their phone, eliminating the need to handle items like menus, bills and cards whilst also completely removing face-to-face contact.

Sonny Sehgal is the CEO of Transputec, which recently launched Thermavis, a new temperature checking technology. He added,

“As restaurants begin to reopen their doors, a key concern on the mind of all returning workers and customers will be their own safety. This is exactly why core technology such as non-intrusive temperature checking cameras like Thermavis must be employed – flagging individuals with a body temperature will be crucial in slowing the spread of Covid-19, and key workers will be given peace of mind that this important line of defence is protecting them from working alongside infected individuals.”

‘On the Kickstart scheme’

Kevin Sefton, CEO of untied, the UK’s personal tax app, noted “we believe strongly in supporting young people starting out and welcome the Kickstart scheme as a way to increase opportunity and representation. As a business we will treat Kickstart as an invitation to give people the break that they need and which can set them up for success through the rest of their lives.

We have used access schemes to recruit young people in the past. They have gone on to succeed here and around the world. We’ve learned that it takes commitment to get right and to be meaningful for all parties – which means money going to the person directly, and investing in their training and support.

Businesses will want clarity on eligibility and who they can hire. It would be a tragedy if young people end up trapped in a loop between leaving education, Universal Credit and Kickstart.

With our close partners Fractal who themselves have hired three young people this year, we have just made a joint application for our SMART initiative to the BCR Capabilities and Innovation Fund to help SMEs with tools to manage their capital and tax. This included explicit commitments to creating jobs for those starting out. Kickstarters could enable us to do more.”

Nicholas Heller, CEO and co-founder of Fractal, an SME payments and insights platform, who also helped set up the charity Founders 4 Schools to link all schools with inspirational business leaders, said: “Nurturing young talent is more important now than ever before. The job market is tough right now, so where possible, businesses should make a conscious effort to remember what it was like starting out, empathise and think about the impact you can make on a young person’s life by hiring and training them. In the long run this will benefit the individual, the company and the economy. We are thrilled to be working with untied who share our values and our vision, and it was a no-brainer going in on a joint bid together for our SMART initiative for the BCR Capabilities and Innovation Fund where we state our commitment to creating more jobs”.

Author

  • Gina is a FinTech journalist (BA, MA) who works across broadcast and print. She has written for most national newspapers and started her career in BBC local radio.

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