The win­ners and losers from min­is­ters’ new plan to pro­tect jobs

The Daily Telegraph - Business - - Business - By Mar­i­anna Hunt

THE im­pact of Rishi Su­nak’s new mea­sures to pro­tect jobs will be un­even, with some work­ers ben­e­fit­ing while oth­ers are left be­hind. Here we take a look at the win­ners and losers.

Win­ners

Peo­ple on or re­turn­ing from fur­lough Three mil­lion peo­ple are still on fur­lough and mil­lions more have re­turned to work af­ter ini­tially be­ing put on the Job Re­ten­tion Scheme.

For many, their po­si­tions re­main ten­u­ous. The new wage sub­si­dies could con­vince em­ploy­ers to keep them on at least part-time rather than mak­ing them re­dun­dant.

How­ever, ex­perts are scep­ti­cal. For an em­ployer with two work­ers, it would be cheaper to make one re­dun­dant and pay the other their full wage than to keep both on for half their hours us­ing the new scheme.

(Most) self-em­ployed … up to a point

Free­lancers who face re­duced de­mand over the win­ter months will be able to ap­ply for a grant pay­ing 20pc of their av­er­age monthly prof­its. The max­i­mum pay­out will be £1,875 to cover earn­ings lost be­tween Novem­ber and Fe­bru­ary. They will then be able to ap­ply for another grant to cover them un­til the end of April 2021. The Govern­ment has not yet said what the max­i­mum for this one will be.

They will also be able to spread out their tax due in Jan­uary over the fol­low­ing 12 months. How­ever, many self-em­ployed peo­ple feel hard done by, only re­ceiv­ing 20pc of their usual pay, while em­ploy­ees will get the ma­jor­ity of theirs.

Small and medium-sized busi­nesses

SMEs will be able to ac­cess the Jobs Sup­port Scheme. They will also be able to ex­tend the terms of their Covid loans to up to 10 years. The Govern­ment is also de­vel­op­ing a new loan scheme, which will be an­nounced in Jan­uary.

Losers

Self-em­ployed peo­ple who missed out last time

Peo­ple who work for them­selves and were not el­i­gi­ble for govern­ment sup­port via its grant scheme will miss out once again. This in­cludes those who have only re­cently gone free­lance, those who make prof­its of more than £50,000 a year and com­pany di­rec­tors who pay them­selves via div­i­dends.

Big busi­nesses

Large com­pa­nies will only be able to make use of the jobs sup­port scheme if their rev­enue has fallen as a re­sult of the virus. Even those who have been af­fected may strug­gle to change re­dun­dancy plans at such short no­tice.

Com­pa­nies in­tend­ing to make peo­ple re­dun­dant at the end of fur­lough must give them no­tice on Oct 1. This means busi­nesses have very lit­tle time to adapt their plans.

Tax­pay­ers

The wage sub­si­dies will be far cheaper than the Job Re­ten­tion Scheme but will still add bil­lions to the na­tional debt.

Jobs in the arts and sport

Rachael Grif­fin, of wealth man­ager Quil­ter, said: “The out­look for jobs in the per­for­mance arts sec­tor is par­tic­u­larly grim as most of the venues which sup­port this con­tinue to be closed with no real prospect of open­ing for full ca­pac­ity for many months.”

The same is true for much of sport. If venues are not open, they will not be able to em­ploy peo­ple and the new scheme will fall flat.

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