Furlough scheme is extended again
THE furlough scheme will be extended for another month, Chancellor Rishi Sunak has announced.
The scheme was due to expire at the end of March but the extension suggests the Government believes the economy will still be struggling to cope with the impact of the coronavirus pandemic.
Mr Sunak also extended Government loan schemes until the end of March to help support businesses.
The Chancellor said: “Our package of support for businesses and workers continues to be one of the most generous and effective in the world – helping our economy to recover and protecting livelihoods across the country.
“We know the premium businesses place on certainty, so it is right that we enable them to plan ahead regardless of the path the virus takes, which is why we’re providing certainty and clarity by extending this support, as well as implementing our plan for jobs.”
Mr Sunak also announced that the next Budget will be on March 3, 2021.
Under the furlough scheme, the Government will continue to pay 80% of the salary of employees for hours not worked until the end of April.
Employers will only be required to pay wages, National Insurance Contributions (NICS) and pensions for hours worked; and NICS and pensions for hours not worked.
The business loans schemes had been due to close at the end of January.
The schemes, which will now stay open until the end of March are: the Bounce Back Loan Scheme, Coronavirus Business Interruption Loan Scheme (CBILS), and the Coronavirus Large Business Interruption Loan Scheme (CLBILS).
The schemes have helped keep the economy on life support but have added to the eye-watering cost of the pandemic to the public purse.
Official figures showed that £46.4 billion of furlough payments under the Coronavirus Job Retention Scheme had been claimed for 9.9 million jobs in 1.2 million firms since it was launched in April.
So far £43.5 billion of bounce back loans have been provided to businesses.
Around £19.6 billion has been made available under the CBILS and almost £5 billion in CLBILS, which is for larger companies.
The news came within hours of the announcement that large swathes of southern England will be placed under Tier 3 restrictions from tomorrow due to rising Covid levels.
Health Secretary Matt Hancock set out the findings of the first full review of England’s tier allocations, with very little good news for areas already under tough restrictions. Instead, he was forced to place more areas under the toughest measures, closing pubs, restaurants and cinemas.