No cliff-edge to job protection scheme, Sunak promises
Chancellor Rishi Sunak has promised there will be no “cliff-edge” cut-off to the government’s furlough scheme to support workers through the coronavirus outbreak.
The latest government figures showed that 6.3 million workers were having up to 80 per cent of their salaries paid by the Treasury at a cost of £8 billion to the taxpayer.
Speaking to ITV News, Mr Sunak acknowledged such a level of expenditure was not “sustainable” in the longer term. He said the ministers were looking at ways to wind down the scheme – currently due to run to the end of June – and ease people back into work in a “measured way”.
“To anyone anxious about this, I want to reassure that there will be no cliff-edge to the furlough scheme,” he said.
“I’m working as we speak to figure out the most effective way to wind down the scheme and ease people back into work in a measured way.
“As some scenarios have suggested, we are potentially spending as much on the furlough scheme as we do on the Nhs.clearly that is not a sustainable situation which is why, as soon as the time is right, we want to get people back to work and the economy fired up again.”
The Liberal Democrats have already called for a “tapered” end to the programme, with the Treasury paying 50 per cent of salaries for the first month after people return to work, falling to 30 per cent after the third month, with employers picking up the full bill after the fourth.
Acting leader Sir Ed Davey warned that “the shadow of lockdown will be long, and the “new normal” will be extremely challenging”.
Torsten Bell, chief executive of the Resolution Foundation think tank which proposed the job retention scheme, said that despite the high cost to the taxpayer, it was a price worth paying. “The 6.3 million jobs being furloughed shows in stark terms the scale of the economic shutdown that Britain is living through,” he said. “If this kind of volume of workers stay on the scheme for several months, the cost will run into the tens of billions of pounds. And that is a cost very much worth paying.
“Even despite mass furloughing, unemployment is still soaring, with over two million new claims for benefits.
“This should remind us how badly needed the retention scheme is, but also that we are likely to be living with the legacy of high unemployment that coronavirus has given Britain, long after it has been phased out.”
Meanwhile, the daily attendance allowance for peers should be temporarily replaced by a new payment for remote participation worth only half as much, the House of Lords Commission has recommended.
Under the proposals, the current allowance system will be suspended and the maximum daily rate members can claim for taking part in chamber and committee business will be cut to £162, down from £323 at present.
Peers who claim the money will have to actively take part in the Upper House’s virtual proceedings, such as participating in a committee meeting or speaking in a debate. Members will not be able to claim for simply following proceedings online or in the chamber.