Not bad, Rishi, but it’s job creation that will keep Britain in business

My two daughters are about to buy their first homes. Both had been waiting impatiently for Rishi Sunak’s mini-Budget, setting alerts on their phones to make sure they didn’t miss the Chancellor confirm his much-trailed statement on cutting Stamp duty.

And Sunak did not disappoint. Both daughters and their partners are delighted. Between them they will save thousands of pounds, money which can now either go towards their deposits or on furniture.

But both had quite different reactions to the announcement on Wednesday. The elder said Sunak’s moment at the despatch box reminded her of the power of words and how it must have felt during the war, waiting anxiously for Churchill to give his speeches which so lifted the national mood.

As she put it:  “As well as the Stamp duty cut which will help so many like us, I liked what he said about the nobility of work. Lockdown has been such a shock to so many millennials. It has shaken us up, made us more frugal but we also see this as a time of great opportunity. He gave a feeling of confidence.”

The younger daughter was equally ecstatic but more to the point, saying she and her partner felt like they had won the lottery. As the price they are paying for a two-bedroomed flat in south London is the same as a five-bedroomed house in the north or a small castle in Scotland, you can see why every penny saved is a win

There are thousands of others who will be equally relieved by the Chancellor’s decision to cut the much hated property tax, which has more often than not acted as a brake on house-buying.

Within half an hour of lifting the threshold from £300,000 to £500,000, Rightmove reported a 22% increase in interest on its property website.

No wonder: it is estimated that nine out of ten home buyers will benefit from the Stamp duty holiday until it ends in March next year.

By far the biggest savings are in London and the south east, where the average price of a home in the south east is £419,595, giving homebuyers a saving of £10,980. In London itself, the savings rise to £15,000 while in the North East, where house prices average at £157,000, the saving will be £646.

The criticism – that this was a move that once again helping the richest that will push up prices in the south east – is unjustified, and probably irrelevant. For now, the south east remains the most desirable place to live because that is where so much of the work and opportunity is, prices will stay higher than in the regions. But in a post-Covid world, one where Zoom and other technologies have shown that workers can work well without being office-based, there are bound to be changes to the housing market.

Indeed, many estate agents in the regions say they are being flooded with requests for houses as London-based workers are looking to sell their expensive homes and buy cheaper and bigger in the countryside. Lockdown has shown them that they do not need to be in a London office every day of the week but can work either from home, or indeed from anywhere.

What is perhaps the more interesting point is whether, now that the tax has been cut, any right-minded Chancellor would bring it back. If the government wants the housing market to stay fluid, and for people to be flexible about moving where the work is, it should consider putting this tax on permanent holiday.

Elsewhere, Sunak pulled out many rabbits, and they were on the whole the right ones to help protect those in work and those who are yet to enter the workplace.

The government’s Kickstart scheme will pay the wages of up to 300,000 young people on Universal Credit  – probably the most important policy to help people find work for the future of the country – if businesses agree to take them on for at least six months.

So long as the scheme is not too fiddly or bureaucratic, this is an excellent way to help those stuck on welfare and into work.

Other measures make sense, too. Remember double-glazing salesmen? All those jokes about the man from Everest? Well, the company nearly went bust during lockdown when doing up your house was the last thing on anyone’s mind but it was rescued in a last minute deal. 

The double-glazing industry will be saying prayers of thanks to Sunak, and so will another member of family, my son, who has been toying with double-glazing the windows of his London house for some years. As Sunak has learnt quickly, the personal is political.

If the Chancellor has his way, Everest and the other insulation salesmen will soon be back knocking on your door as he reckons his home insulation measures could save up to 100,000 jobs.

Up to £50 million is to go on these home improvements while another £1bn is to be spent on schools, hospitals and other public buildings.

While upgrading homes and public buildings is a good idea what would be far more effective would be for the government to tighten up regulations to make sure buildings are more energy-efficient but ensure builders follow existing regulations. Let’s hope a more stringent regime of testing will come later.

There was also much more that the Chancellor should have done to kickstart the economy.

He was right to do what he can to protect existing jobs but there was little in Sunak’s programme that will help create future company creation.

These should be relatively straightforward: increase tax incentives to encourage angels and wealthy individuals to invest in start-ups and SMEs and abolish capital gains tax.

One can only hope that the Chancellor is saving that for the autumn statement when the economy will need rocket boosters to get growth going again.

But for now, Sunak appears to have succeeded in creating a mood of optimism and hope, especially in hospitality.

Perhaps it’s Sunak’s experience of working as a waiter while at school that has given him such an interest but he does like his restaurants. The temporary VAT cut from 20% to 5% for the hospitality and tourism sector will cost the government £4 billion but in terms of the confidence it instills, the payback could be huge.

Every Chancellor is allowed one gimmick: Eat Out to Help Out is Sunak’s. Whether you think these food vouchers – giving us all up to £10 off a head during August – are silly, or not, is hardly the point.

What the meal discounts have done is to get everyone talking about them and the prospect of getting back to some sort of semi-normal social life. They add a little more fuel to the growing bandwagon that is the Rishi Sunak Party, too.