Warning over furlough withdrawal
CHANCELLOR RISHI Sunak has been told he has 24 hours to change course on the Government’s furlough scheme or risk making a “historic mistake”.
Labour has warned Mr Sunak that vast numbers of jobs could be lost if he does not abandon his “one-size-fits-all” withdrawal of furlough support.
From August 1, employers will have to pay National Insurance and pension contributions for their staff.
And in September, firms will have to pay 10 per cent of furloughed employees’ salaries – rising to 20 per cent in October.
Shadow Chancellor Anneliese Dodds said the move could lead to a “python-like” squeeze on jobs in some of the sectors that have been hardest hit by coronavirus.
She made the comments ahead of a visit to Peterborough with Labour leader Sir Keir Starmer, where the party will launch its nationwide jobs campaign.
“The Chancellor’s refusal to abandon his one-size-fits-all withdrawal of furlough is a historic mistake that risks a pythonlike squeeze on jobs in the worsthit sectors,” said Ms Dodds.
“The reward for months of hard work and sacrifice by the British people cannot be a P45. It’s not too late for the Chancellor to see sense, change course and support the businesses and sectors that need it most.”
Ms Dodds added: “The Government should back viable businesses that are still impacted by coronavirus, support the self-employed and come up with a plan to drive job creation as we emerge from the pandemic.
“And it must ensure our NHS and care services are fully prepared for a second wave – we won’t recover from this economic crisis until the Government gets a grip on the health crisis.”
As part of its campaign, Labour has set out a five-point pledge, with a focus on protecting jobs and businesses.
The party has urged the Government to reform the furlough scheme so that it supports jobs in the worst-hit sectors and targets aid to struggling industries.
It has also called for a £1.7bn “fightback fund” to prevent firms going under, additional support to areas forced into local lockdowns, and an investment in infrastructure.
Making workplaces safe and giving NHS and care services the resources to avoid a second wave are also outlined in the campaign, along with the protection of workers’ rights and a rise in sick pay.
A Government source maintained that the support being provided is “comprehensive and generous” and added: “This Government has worked tirelessly during this crisis to protect jobs, livelihoods and businesses. At every step we have acted at scale and at pace to ensure as many people as possible are supported during this difficult time.
“The furlough scheme is unprecedented and has so far supported the wages of 9.5m people, at a cost of £31.7bn and will run for eight months in total. It is not a ‘one-size-fits-all’ policy, it is the most comprehensive and generous version of support that can be provided.
“Labour seems to be good at calling for things, but repeatedly fail to put forward any detailed plan on how they can be delivered. As the economy reopens, we are adjusting the support to ensure people can get back to work and we can rebuild our economy.”
A historic mistake that risks a python-like squeeze on jobs.
Shadow Chancellor Anneliese Dodds on Rishi Sunak’s furlough support withdrawal.