It's on top of their basic vacation (which, at 3 weeks, isn't stellar, but is better than many US jobs), and the implication is that you take it all at once -- so not to be sniffed at, I'd say. It's not really equivalent to traditional academic sabbaticals, but it is potentially enough to study something new or get a little side-project off the ground.

Edit: the 4-day-summer-weeks thing should typically work out as an extra 17 days off per year, which makes the total -- before counting sabbatical -- higher than the great majority of UK employers, albeit (maybe) with less flexibility.