John Lewis to reject furlough cash bonus
John Lewis, the retail giant, will reject the Chancellor’s offer of £1,000 for every furloughed worker brought back to the shop floor, following similar announcements from Primark and William Hill, the bookmaker. The retailer, which furloughed 14,000 shop workers at the start of the crisis, is not expected to collect any money from the job retention bonus set out last week by Rishi Sunak. It has said that eight of its 50 stores will not reopen, following a slump in sales.
JOHN Lewis will reject the Chancellor’s offer of £1,000 for every furloughed worker brought back to shop floors, following similar announcements from Primark and William Hill, The Daily Telegraph has learnt.
The retailer, which furloughed 14,000 shop workers at the start of the crisis, is not expected to collect any money from the Treasury’s job retention bonus, announced last week by Rishi Sunak.
It has already announced eight of its 50 stores will not reopen after the pandemic, following a sales slump over the period it was forced to close doors.
Major stores will close in Birmingham and Watford, and smaller ones in Heathrow airport and St Pancras train station, as well as At Home shops in Croydon, Newbury, Swindon and Tamworth. Other stores are in the process of a “phased reopening” being done over coming weeks.
Wes Streeting, a Labour shadow Treasury minister, warned that John Lewis’s decision could mean more job losses were on their way.
“I think the fact that John Lewis are not taking part in the job retention bonus scheme, and at the same time are floating the closure of stores and the inevitable job losses that will fol- low, underline exactly why the Institute for Fiscal Studies described the job retention bonus as a poorly targeted and deadweight cost,” he said.
“The Government should be focused on keeping people in work and avoiding job losses, but it’s not yet clear the job retention bonus will do that. The risk is it hands over significant sums of money to firms that don’t need it.
“Where companies don’t need to access the scheme and choose not to, that’s welcome, but there may well be some companies at the margins where this would make a big difference.”
William Hill, the bookmaker, and clothing chain Primark became the first companies to reject the jobs retention bonus over the weekend.
Primark said it would not claim any money because it had already removed employees from the furlough scheme when its stores reopened.
The Chancellor’s scheme is expected to cost the Treasury around £8billion, with the Government paying out for the return to work of many of the 9.4million UK workers who were furloughed because of the pandemic.
Labour questioned whether Mr Sunak’s scheme offered value for money for taxpayers after Jim Harra, the chief executive of HMRC, told the Treasury that he would require ministerial direction for the policy.
“The advice that we have both received highlights uncertainty around the value for money of this proposal. I am unable to reach a view that this represents value for money to the standards expected by MPM [Managing Public Money],” he said.
Frances O’grady, the general secretary of the Trades Union Congress said employers who can afford to do so should be following Primark’s example to save the taxpayer.
Speaking on Sky’s Sophy Ridge on Sunday, she added: “I think what we are worried about is that there is a risk of getting into gimmicks, rather than giving the targeted support that industries need.”
Mr Sunak said there were “compelling reasons” to justify the introduction of the programme, and issued the order for it to continue.
Last Thursday, the Chancellor admitted that some of the £1,000 bonuses will be “deadweight” because they will pay companies who were going to bring workers back anyway.