HMRC chief refuses to back Chancellor’s plans for £1,000 jobs bonus as cost concerns mount
THE boss of HMRC has refused to sign off Rishi Sunak’s £1,000 bonus scheme for firms that bring back furloughed workers amid concerns it may do little to save jobs.
In a letter to the Chancellor, Jim Harra warned that it was hard to predict the impact of one of his flagship rescue plans – both in terms of its possible cost and the positive difference the programme would make.
It came as Mr Sunak himself admitted that some taxpayer cash ploughed into the scheme would be wasted on firms that would have retained staff anyway. The scheme is intended to persuade firms to bring back as many as possible of the 9.4m workers who were put on taxpayer life support through the furlough scheme.
The subsidy is being wound down by October and it is feared this could trigger a huge wave of job losses.
In an attempt to prevent massive layoffs, the programme will pay £1,000 for every previously furloughed staff member kept in a job until January.
The head of HMRC said he needed written instructions to go ahead from Mr Sunak because the scheme was so risky, under Whitehall procedure typically used by mandarins when they are unable to satisfy themselves about a policy through the usual checks.
These “ministerial directions” have already been needed to push through policies at least 11 times during the pandemic. Mr Harra said “there is a sound rationale” for offering the payout.
The Institute for Fiscal Studies said the bonus would cover more than half of the costs for employing the lowestpaid workers between the end of the furlough scheme and January. It would cover around a quarter of these costs for the average furloughed worker.