The Courier & Advertiser (Fife Edition)
FURLOUGH SCHEME
Chancellor Rishi Sunak announces five-month extension after week of confusion and pressure.
Rishi Sunak has announced a five month winter extension to the furlough scheme, ending days of confusion over whether support would be offered to Scottish workers in the event of a future lockdown.
After a week of pressure from the devolved governments and businesses, the chancellor revised his initial furlough offer – which tied in with England ’s month-long shutdown – and extended the scheme until the end of March.
Under the chancellor’s plan, the less generous job support scheme will be suspended and workers will again have 80% of their wages paid for by the Treasury.
Support for the selfemployed will also return to more generous levels, with grants of up to £7,500 on offer.
Mr Sunak said :“I’ ve always said I would do whatever it takes to protect jobs and livelihoods across the UK – and that has meant adapting our support as the path of the virus has changed.
“It’s clear the economic effects are much longer lasting for businesses than the duration of any restrictions, which is why we have decided to go further with our support.
“Extending furlough and increasing our support for the self- employed will protect millions of jobs and give people and businesses the certainty they need over what will be a difficult winter.”
Prior to Mr Sunak’s speech, ministers had been ducking questions from the press and MPs over whether furlough support would be granted to workers in Scotland, Wales and Northern Ireland beyond the end of England’s lockdown on December 2.
Shadow chancellor Anneliese Dodds slammed the uncertainty caused, saying it had cost jobs.
She said: “Businesses and workers have been pleading for certainty from this government, but the chancellor keeps ignoring them until the last possible moment, after jobs have been lost and businesses have gone bust.
“This is the chancellor’s fourth version of his winter economy plan in just six weeks, he can change his mind at the last minute, but businesses can’t.
“We need a chancellor who is in front of the problems we face, not one who is always a step behind.”
The SNP’ s Treasury spokeswoman, Alison Thewliss, also hit out at the delay, saying it was a “democratic disgrace that Westminster was only willing to act when England faced lockdown and not when Scotland needed support”.
She added: “For many it is far too late. Thousands have already lost their jobs, many good businesses have gone under, and millions have been excluded completely.”
The chancellor dismissed her remarks, saying his statement would “reassure” the people of Scotland.
He said: “The furlough scheme was designed and delivered by the government of the United Kingdom on behalf of all the people of the United Kingdom – wherever they live.
“That has been the case since March; it is the case now; and will remain the case until next March.”
In response, Mr Sunak also announced an increase in the upfront guarantee of funding for the devolved administrations from £14 billion to £16bn, of which £1bn will go to Holyrood.
His statement came after the Bank of England said it was pumping an extra £150bn into the economy.
The Bank warned the resurgence of Covid-19 would lead to a slower, bumpier recovery.
Around £40bn has been spent on the furlough scheme, which pays 80% of workers’ wages up to £2,500, since it was introduced in March.
Mike Cherry, chairman of the Federation of Small Businesses, said: “We are pleased that the chancellor has listened to calls to help both groups of members that FSB champions – small employers and the self-employed.
“At a time of unprecedented restrictions, this will help small employers and the self employed to mitigate some of the economic damage.”
Kate Nicholls, chief executive of trade association UK Hospitality, said: “The extension of furlough to the end of March will make a huge difference in helping to protect hospitality jobs across the whole of the UK.
“Hospitality is facing a tough winter, so this enhanced support is crucial and will safeguard jobs and help businesses to plan for a more certain future.”
Businesses and workers across the UK will be breathing a sigh of relief after Chancellor Rishi Sunak’s shock move to extend the furlough scheme.
The enormously expensive scheme has been the glue that has kept the economy together since Covid forced the country into an unprecedented lockdown in March.
Having provided protection for an estimated nine million jobs, the chancellor had hoped to put furlough out to pasture and replace it with a much less generous job support programme.
But at the very moment the switch was due to happen, the chancellor’s hand was forced by a resurgence of the virus.
His agreement to extend furlough in England for a month to cover a new lockdown there was a red rag to the devolved administrations who had repeatedly called for the scheme to remain open to minimise the impact on jobs and businesses.
That pressure told yesterday as Mr Sunak about-turned and pledged that furlough would continue to operate through the dark winter months ahead.
It is the right decision and it should be welcomed, but there are thousands for whom the support now offered has come too late.
That is businesses and workers who have been placed under unnecessary stress and left hanging by a thread.
Cash is king for companies but certainty comes a very close second, something the chancellor had in his power to provide all along.
Mr Sunak’s intervention is better late than never. But action should have come long before the economy was standing staring into the abyss.