Coronavirus: Sunak may hand out £500 vouchers to boost spending

·2-min read

UK chancellor Rishi Sunak is considering giving vouchers worth £500 ($624.20) to adults and £250 to children to boost spending in those parts of the economy that have been particularly badly hit by the coronavirus pandemic.

This is based on a proposal by a think tank called Resolution Foundation, which has reportedly been in talks with the Treasury.

“The proposal, which forms part of wider fiscal stimulus package put forward by the Foundation, would involve the delivery of up to £30bn 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.

It explained that the “High Street Voucher” scheme would delivered via vouchers or smartcards and activated over a fixed time period. They can be deactivated if the sectors benefitting from the scheme need to be closed down in the event of a second wave of the infection.

Chancellor of the Exchequer Rishi Sunak walks through from the foreign office to Downing Street after the introduction of measures to bring the country out of lockdown. (Photo by Aaron Chown/PA Images via Getty Images)
Chancellor of the Exchequer Rishi Sunak. Photo: Aaron Chown/PA Images via Getty Images

READ MORE: UK chancellor eyes VAT cut

It said its suggestion is better than repeating policies from the financial crisis, such as VAT cuts, because the issues were very different back then.

A report in The Guardian said 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 in our plan to secure Britain’s recovery” on 8 July, where he is expected to say the number of work coaches will double from 13,500 to 27,000 in a bid to try to help jobseekers back into employment.

Some countries have successfully launched similar initiatives. For instance, back in April around 50 cities in China distributed vouchers amounting to more than CNY6bn ($849m), according to data compiled by Bloomberg.

Meanwhile, 4 July saw the reopening of businesses including restaurants, bars, cinemas and hairdressers.

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