Axe furlough scheme for good, says think-tank

ONE of Britain’s leading economic thinktanks has called for a permanent end to Government furlough, despite warning there could be a rise in unemployment when the scheme stops later this month.

The Resolution Foundation told The Mail on Sunday that there is ‘no need to extend furlough or provide further targeted support,’ given that there are now no restrictions on businesses operating normally.

Chancellor Rishi Sunak introduced furlough, officially the Coronavirus Job Retention Scheme, at the start of the first lockdown to cover 80 per cent of employees’ usual monthly wages to protect jobs.

It is widely considered to have been successful, keeping unemployment low despite forecasts that a pandemic recession could trigger unemployment of up to 10 per cent.

The Trades Union Congress, the umbrella body for UK unions, has urged the Government to abandon plans to scrap the scheme and instead create a permanent scheme to deal with future periods of economic turbulence.

The Resolution Foundation said it accepts the jobs market is in for a ‘bumpy ride’, with a possible rise in unemployment from 4.4 per cent to 4.9 per cent.

But its report said: ‘It certainly seems plausible that we have passed the peak of unemployment, reflecting the extraordinary success of the job retention scheme in keeping people in their jobs.’