Rishi Sunak unveils his first Budget; announces 30 bn pound stimulus package to combat coronavirus

Britain's Indian-origin Chancellor of the Exchequer Rishi Sunak unveiled a 30-billion pound package on Wednesday to tackle the "temporary disruption" from the coronavirus outbreak as he declared that while the going will be tough for some as a result of the added impact of the crisis, the UK economy is well placed to pull through.

Sunak, the 39-year-old MP who tabled his first Budget in the House of Commons, was cheered on by Prime Minister Boris Johnson and Home Secretary Priti Patel just behind him on the ruling Conservative benches as he announced that his Budget had taken the party's election pledges into account to “get things done”.

He warned of a "significant" but temporary disruption to the UK economy.

"We will get through this together," said Sunak, the son-in-law of Infosys co-founder Narayana Murthy, as he unveiled the 30-billion pound package of measures as a stimulus to cope with the "temporary disruption" to the economy from the coronavirus crisis.

"For a period, it’s going to be tough. But I'm confident that our economic performance will recover," he said.

The minister said that as the country deals with COVID-19, the Budget provides security today but also sets out a plan for prosperity tomorrow.

"It is a Budget that delivers on our promises to the British people. It is a Budget of a government that gets things done,” he said.

"We are doing everything we can to keep this country and our people healthy and financially secure," he told MPs.

The hedge fund manager turned politician stressed that his maiden Budget was “brave and bold” because it lays out mega investment plans for different parts of the UK as a non-member of the EU.

He said: "This is the first Budget of a new decade. The first in almost 50 years outside the European Union. And the first of this new government.

"At the election, we said we needed to be one nation. While talent is evenly spread, opportunity is not – we need to fix that… We promised to get Brexit done, and we got it done."

On infrastructure front, he set out 600-billion pound to be spent on roads, rail, broadband and housing by the middle of 2025, dubbed the country's largest capital investment in infrastructure for generations.

The Budget confirmed some previously known plans such as the abolition of the so-called "tampon tax" or VAT on sanitary products from January next year and to establish UK Treasury offices in Scotland, Wales and Northern Ireland as well as a new "economic campus" with over 750 staff in the north of England, the region Sunak represents as an MP for Richmond in North Yorkshire.

He also unveiled a “bumper” exports package to support British business "make the most" of the opportunities of Brexit. The package will include 5 billion pound of loans designed to stimulate British businesses and bolster their global standing through UK Export Finance (UKEF), the government agency providing loans to overseas buyers of British goods and services.

"This package – which is the highest level of export lending the government has ever made available – will provide support to industries and regions across the country,” said Sunak.

“This decade will provide even more opportunities for British businesses to export and trade with new partners across the world. The government will support the business to seize these opportunities and thrive on the world stage,” he said.

On the environment front, he announced a plastic packaging tax to come into force from April 2022 as well as increased anti-pollution taxes.

On a lighter note, he also announced he was abolishing VAT on books, newspapers, magazines and academic journals from December 1, which would include Labour Party Shadow Chancellor John McDonnell's ‘Economics for the Many’, which he joked had not sold many copies anyway.

He was patted on the back by Johnson as he sat down at the end of an over hour-long speech, his first major task since he was suddenly promoted to the post of Chancellor of the Exchequer after his predecessor, Sajid Javid, resigned amid a disagreement with the prime minister during last month’s Cabinet reshuffle.

Sunak has since cast himself as a finance director of the country with Johnson as the CEO and had been focussed on delivering his first Budget just weeks into the job. He may now turn his focus on shifting into the Chancellor’s flat on Downing Street with wife Akshata Murthy and their two daughters, Krishna and Anoushka.

(Photo: AP)