£15bn and counting ...Rishi tackles furlough bill
RISHI Sunak will tomorrow move to cut money spent on furloughing workers after the bill hit £15billion.
Treasury figures yesterday revealed that more than a million employers are claiming cash under the Chancellor’s Job Retention Scheme to cover the salaries of 8.4 million staff.
Around 400,000 employees were added in the last week to the aid package where the Government pays 80 per cent of an employee’s wages up to a maximum of £2,500 a month.
Mr Sunak is expected to set out tomorrow how much firms will have to contribute towards wages of furloughed workers from the beginning of August.
Under draft plans, employers would pay a fifth of furloughed workers’ original salaries with taxpayers paying 60 per cent. The company would have the choice of either paying the remaining 20 per cent or cutting the salary.
Yesterday Boris Johnson warned bosses not to cynically fire furloughed workers when the scheme ends.
The PM told MPs: “I am concerned about the way some companies are treating their workforce. We’ve got to look after people properly.
“I’m well aware of some of the issues that are starting to arise. People should not be using furlough cynically to keep people on their books and then get rid of them.
“We want people back in jobs, we want this country back on its feet, that’s the whole point of the furlough scheme.”
He spoke out during a hearing of the Commons Liaison Committee yesterday.
Asked by one MP about British Airways plans to make 12,000 staff redundant, Mr Johnson said ministers were examining the issue.
Last night a survey warned that one in four firms will struggle to come up with the furlough shortfall.
And hospitality employers pleaded for the scheme to remain unchanged with many pubs, restaurants and hotels expected to be forced to stay closed for many more months.
The survey of almost 700 bosses by the Institute of
Directors found about half could provide 20 per cent or more towards furloughed workers’ full-time salaries between August and October. A quarter of those polled claimed they could not afford any amount.
More than a third said they would bring most of their furloughed workers back part-time, if it was allowed.
Director general Jonathan Geldart said: “If there’s no money coming in, many firms will be forced to make difficult decisions in August.
“The Government must soften the blow by introducing as much flexibility as possible into the furlough system.
“The more flexible the scheme is, the better firms can recover, and the fewer jobs will rely on state subsidy.”
A joint letter from the British Beer & Pub Association, the British Institute of Innkeeping and UK-Hospitality urged the Chancellor to keep the furlough scheme unchanged for their industry until October.
Emma McClarkin, chief executive of the British Beer & Pub Association, said: “Under twometre distancing rules, pubs will have less space to operate with so will need fewer staff. Many pubs won’t even be able to re-open, yet they could be expected to cover part of their staff furlough costs from August without money coming in.
“Such a situation would mean either pubs closing for good or jobs being lost.”
The Treasury also showed that banks have funnelled more than £27billion to companies as part of three state-backed loan schemes.
And £6.8billion has been claimed via 2.3 million applications from the self-employed who are unable to work.