Furlough scheme extended for further four months
By Rob Freeman | 12th May 2020
The Government has extended its furloughing scheme for workers until the end of October.
But Chancellor Rishi Sunak has confirmed it will be altered to allow part-time returns to work from the end of July.
Mr Sunak, speaking in response to a question from Shadow Chancellor Anneliese Dodds, said the scheme will remain unchanged until the end of July - a month's extension from its current deadline.
The extension until the end of October means the Coronavirus Job Retention Scheme will be in place for eight months with around a quarter of the UK workforce being paid 80 per cent of their wages by the Government while off work.
He said: "We believe in the dignity of work and we are doing everything we can to protect people currently unable to work.
"I'm extending the scheme because I won't give up on the people who rely on it.
"We stood behind workers and businesses as we came into this crisis and we will stand behind them as we come out of it."
Mr Sunak rejected suggestions some people might get "addicted" to furlough if it was extended.
"Nobody who is on the furlough scheme wants to be on this scheme," the Chancellor said. "People up and down this country believe in the dignity of their work, going to work, providing for their families, it's not their fault their business has been asked to close or asked to stay at home.
While workers will continue to be paid 80 per cent of their wages until the end of July, the Chancellor said changes will then be introduced with the burden of paying salaries shared between the Government and employers.
Further details on how the amendments will work will be published by the end of May.
Responding to a question to Forest of Dean MP Mark Harper, the Chancellor said he expected it would be able to end the scheme in October but it would be kept under review.
Around 7.5 million workers are now covered by the scheme, up from 6.3 million last week, the Chancellor said.
British Chambers of Commerce director general Adam Marshall said the extension of the scheme was a "huge help and a huge relief".
He said: "Over the coming months, the government should continue to listen to business and evolve the scheme in line with what's happening on the ground.
"Further support may yet be needed for companies who are unable to operate for an extended period, or those who face reduced capacity or demand due to ongoing restrictions."
The scheme was described by Prime Minister Boris Johnson as "one of the most remarkable features of the Government's response" to the pandemic.
Any company seeking to cut more than 100 job must run a 45-day consultation, meaning May 18 was the last date employers could start this process before the furlough scheme ended in June.
Punchline says: The Chancellor seems to be enabling the economy to carry on, stopping people from becoming unemployed and ensuring they can pay their mortgages, their cars and their lifestyles - anything else would have seriously damaged the long-term ability of the economy to bounce back. It will cost us in the end but it will be a cost worth paying.What do you think? Has the Chancellor done enough? Email your thoughts to firstname.lastname@example.org
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