Economic Recovery Plan A platform for an economic fightback (towards a green, digital, safe future)

Industry update – 30th September 2020 Treasury Minister Hon. A Cannan MHK AGENDA

Economic Update

Recap Programme & Principles

Programme Update

Alfred Cannan, MHK - Treasury Minister Q&A , MHK - Minister for Enterprise Caldric Randall - Chief Financial Officer, Treasury Mark Lewin - Chief Executive, Department for Enterprise THE VIRUS

• Disrupted our transport links • Disrupted Economic Activity • Threatened our Domestic Economy • Closed down our Tourism Sector • Disrupted Public Finances • Created global economic instability

Presents a clear threat to jobs, economic stability and future investment THE VIRUS

This clear threat demands a Response. We must act to:

• Protect jobs

• Stabilise our economy

• Invest in our future

Our response is both proactive and reactive Economic Update UNEMPLOYMENT VACANCIES SUPPORT SCHEMES SUPPORT SCHEMES RESERVES CURRENT POSITION

881  36% reduction since peak Unemployment unemployment figures  MERA reduced to 919 (peak of 2,410) - 919 scheme ended 20th September MERA  > 60% Reduction

 P6 Salary support reduced from 10,910 2,153  C. 80% Reduction Salary Support  P7 further significant reduction expected

 14,688 people supported at peak 14,688  > 35% of the Island’s working population Working Residents  > 55% including public service Economic Recovery Programme Recap RESPONSE FRAMEWORK ECONOMIC PROGRAMME FRAMEWORK GOVERNANCE & DASHBOARD PRINCIPLES

Any activity approved through ERG providing temporary funding for activities that are outside of the normal functions of the Department and/or provide support to help accelerate current Departmental activities and meet one or more of the following criteria:

Principle 1: Protects business and employment where it may otherwise be threatened due to COVID-19 over the next 9 months (from July 2020)

Principle 2: Provides employment opportunities for those individuals who would otherwise be unemployed due to the impact of COVID-19, for up to 12 months (from July 2020)

Principle 3: Provides meaningful work and training for those individuals who would otherwise be unemployed due to the impact of COVID-19, which promote future employment opportunities befitting the Island’s needs PRINCIPLES

Any activity approved through ERG providing temporary funding for activities that are outside of the normal functions of the Department and/or provide support to help accelerate current Departmental activities and meet one or more of the following criteria:

Principle 4: Provides a significant boost to economic activity where it may otherwise be subdued to COVID-19, which protects business, employment and Government revenues in the next 9 months (from July 2020)

Principle 5: Ensures the Island is prepared to take advantage of economic opportunities that present themselves in the short to medium term as the economy recovers from COVID-19 (9-18 months: from July 2020)

Principle 6: Helps determine the longer term economic strategy and activity for the longer term (18 months +: from July 2020) Economic Recovery Programme Update ECONOMIC RECOVERY GROUP

Treasury Minister MHK

Minister for Enterprise, Laurence Skelly MHK

Policy and Reform Minister, MHK

Policy and Reform Political Member Minister, Ray Enterprise, Lawrie Harmer MHK Political member for Treasury,Hooper MHK MHK

Political member for Enterprise, MHK WORK STREAM LEADS

Work Stream Leads

Our Our People Our Island Our Domestic Our Future Businesses Economy

Caldric Randall Julie Bradley Sheila Lowe Peter Boxer Mark Lewin

Our Economic Strategy

Adam Smith OUR BUSINESSES

Programme lead: Caldric Randall Objective: Protect jobs, businesses and industries in the Island.

The Economic Recovery Group will seek to:

• Support businesses where national or international COVID-19 policy have severely restricted their market sector or operating ability; ensure any support is available to the whole sector equitably and does not distort the local market. • Provide recovery and transitional assistance for a period after operating restrictions have been lifted to allow a return to normalised trading • Remove direct assistance where sectors are able to operate on a fair and equitable basis without COVID restriction OUR BUSINESS - UPDATE

Recent changes as a result of strong employment figures:

• 5% VAT reduction to hospitality, accommodation and attractions extended to 31 March 2021 • MERA ceased 20th September • Salary support closed to sectors other than travel & tourism • Business support schemes under constant review and prepared to re- implement if required

• Support extended for strategic sectors still affected: Travel & Tourism Support extended to 31st March 2021 Fisheries Support £4.2m £4.5m £1.7m £0.25m Salary Support Strategic Tourism & To November 2020 To March 2021 Capacity Travel FAS WIDE RANGING SUPPORT

Salary Support MERA CBSS (£3k)

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Core £41m £5.9m £9.6m 11,000 people 1951 people 3000 people Strategic Strategic Travel & Tourism Fisheries Capacity 1&2 Capacity 3 £5.4m £4.5m £1.7m £1m

Sector Sector Specific Apr – Sep Oct – Mar 21 Jul – Mar 21 Apr - Nov Deposit Loan Working Capital Business Strategic Guarantee Loan Adaptation Investment Fund £40m £10m £0.6m Flexible 80% Guarantee 100% Guarantee 50% Funding National Insurance Additional Support Additional VAT Deferral VAT 5% Rate Holiday OUR PEOPLE

Programme lead: Julie Bradley Objective: Create up to 1,000 training, education and work placement opportunities 6 – 12 month programme to…

...Reduce headline rates of unemployment

... Create training opportunities

... Respond to the Island's economic and skills need OUR PEOPLE - UPDATE

• Creation of up to 1,600 additional education £0.9m opportunities at UCM from September 2020 UCM

• Contingency funding to lower UCAS points from £1m/pa 80 to 72 to support up to 60 additional students UCAS Points in higher education

• Student Internship Scheme to create 100+ £0.24m work placement opportunities Student Internships

• 12 month work placement scheme* to create 120 £1.75m new jobs for long-term unemployed– Re-Start Scheme Government to subsidise salary & NI costs * subject to approval OUR ISLAND

Programme lead: Sheila Lowe Objective: Invest in or speed up initiatives that that help to transform our Island and support construction activity 6 – 12 month programme to…

…accelerate capital infrastructure projects

…make the Island a more attractive place

…support the climate mitigation plan OUR ISLAND - UPDATE

£1.5m • £1m funding for Accessibility Improvement Grants • £0.5m for Business Improvement Scheme Accessibility Grants

• Amendments to Town and Village regeneration £1m scheme* to allow for more flexibility Town & Village Regen

£0.1m • £100,000 support short term resource for DEFA planning department Project Acceleration

£0.47m • Acceleration of projects for Manx National Manx National Heritage Heritage (phase one) * subject to Tynwald approval OUR DOMESTIC ECONOMY

Programme lead: Peter Boxer Objective: Protect jobs and businesses in the local economy

6 – 12 month programme to…

…stimulate local spending

...support tourism, hospitality and the domestic sectors

... support jobs in a thriving domestic economy OUR DOMESTIC ECONOMY - UPDATE

• Funding to support the development of events £0.5m fund to support local events and stimulate Events Challenge Fund spending in the domestic economy

• Support of local Staycation campaign to #LoveIOM stimulate local spending • Support of ‘buy local’ campaign, #LoveIOM to stimulate local spending • Support and promotion of Supermanx Bank Holiday • Mighty Manx Menu/ voucher scheme being £tbc prepared in case of need OUR FUTURE

Programme lead: Mark Lewin Objective: Create up to 1,000 new jobs in new business sectors over the next five years 1 - 4 year programme to…

... Create new sectors and create new job opportunities

... Promote the on a global scale

... Move toward a digital, green, safe Island OUR FUTURE - UPDATE

• Accelerate National Fibre Broadband delivery £1.4m from five years, to four years National Broadband Plan

• Funding to extend and accelerate Locate Isle of £0.42m Man activity and maximise current opportunities Locate Isle of Man

£0.55m • Funding to develop Medicinal Cannabis sector legislative framework for 2021 season Medicinal Cannabis

• Development of Corporation board including £0.12m design and recruitment of Chair and Non- Development Corporation Executive Directors Investing in our Future Developing a 5 - 10 year Economic Plan for the Isle of Man OUR FUTURE

Programme lead: Adam Smith Objective: Develop a five to ten year economic plan for the Isle of Man ECONOMIC STRATEGY DEFINE ECONOMIC RESEARCH VISION ANALYSIS

Build on key What are the What domestic themes already strengths and and global issues identified to weaknesses of the are likely to define long term Island’s existing impact the aim for the economy? Island’s economy? Island’s economy STAGE THREE – LONG TERM

ECONOMIC STRATEGY

Fiscal Strategy

Taxation Strategy

Industry Strategy

Sector Strategy Summary SUMMARY

The Island’s Economic Recovery so far is encouraging – but we must not be complacent Economic Recovery Programme provides scaleable platform that is both proactive and reactive 19 initiatives approved, underway or in formation stages £12.1m funding allocated in addition to business support schemes Emphasis on collaboration - Ideas welcome BUT… PREPARATION

Plan B: Turn on Salary Support

Turn on MERA

ERG Meet weekly / daily

Reserve Schemes are ready

Government work schemes could be implemented

Availability of reserves/credit Questions?

Protecting Jobs

Stabilising our Economy

Investing in our Future