Furlough extended: Will the furlough scheme be extended to the end of the year? | Personal Finance | Finance

0
Spread the love


The scheme was extended in October by the Chancellor Rishi Sunak on the day it was due to expire, leaving many workers in the lurch as companies made redundancies in anticipation of the support scheme ending. It first began in March 2020 prior to the first lockdown coming into place.

Also known as the Jobs Retention Scheme, it has been through several changes since it first started in line with the changing coronavirus situation.

Now, the Chancellor is being called upon once again to extend the scheme further as the coronavirus crisis continues into the new year.

It is rumoured that Prime Minister Boris Johnson and Mr Sunak have come to an agreement on how best to plot the UK’s economic recovery from COVID-19, as the end is thought to be in sight with the fast-moving vaccination programme underway across the UK.

Government data shows that four million people were using the scheme during the last two months of 2020.

Will the furlough scheme be extended to the end of the year?

Currently, the Jobs Retention Scheme is set to last until the end of April, but it now looks like the scheme could be extended further into the summer months as the coronavirus crisis deepens throughout the UK.

The scheme, which has now cost £82 billion, pays up to 80 percent of wages up to £2,500 per month.

While Covid rates are falling slowly and vaccination programmes are well underway, there is still no sign lockdown restrictions will end anytime soon, so a definite end date for the scheme is difficult to predict.

DON’T MISS
State Pension: Britons could claim extra £356 each month for arthritis [EXPLAINER]
Rishi Sunak may target your pension allowance this year – key deadline [ANALYSIS]

However, it is thought that Mr Sunak will use the spring budget to extend government relief, including the furlough scheme, business support loans, cuts in VAT — and perhaps even stamp duty — until the virus is under control.

He will also announce that those measures will be phased out across the year in favour of “a plan for jobs” to kick-start employment and a “plan for growth” to promote new industries.

When asked about a potential furlough extension, a Treasury spokesperson said: “We’ve invested more than £280bn throughout the pandemic to protect millions of jobs and businesses – and extended our self-employed and furlough schemes through to April so that people have certainty that help is in place.

“At the upcoming Budget the government will set out how we’ll ensure public services continue to receive the investment they need.”

Business leaders have prompted the Chancellor to extend the scheme past April.

The CBI and the British Chambers of Commerce, two of the UK’s largest business groups, called for an extension of Mr Sunak’s flagship coronavirus scheme.

CBI director-general Tony Danker said: “The government must once again stand shoulder-to-shoulder with businesses to underwrite support for the duration, helping viable enterprises to last the course.”

Mayor of London Sadiq Khan also backed the call for an extension of the furlough scheme, as well as an extension of the business rates holiday past March.

Mr Khan said: “Current plans to end the business rates holiday in March and then the furlough scheme in April create a huge financial cliff edge for employers.

“Without the certainty that support will remain in place for as long as it is needed, many more businesses could decide to cut their losses and close permanently now.”

Frances O’Grady, head of the TUC, commented recently: “It would be a dereliction of duty of any government [not to extend furlough].

“Nobody should think it is responsible or acceptable for any government to consign people to the dole queues.

“The Government must understand we need to work our way back to growth, and for that we need people in jobs.

“Otherwise we are going to end up with real, deep economic and social problems.”





Source link

Leave A Reply

Your email address will not be published.