May 12, 2020
This Government has made it a priority to help those affected by coronavirus. And we're delivering on generous world-leading measures to support businesses and safeguard jobs. That's why we're extending the Coronavirus Job Retention Scheme until the end of October.
Our Coronavirus Job Retention Scheme has protected millions of jobs and businesses across the UK during the outbreak – and the Chancellor has been clear that he wants to avoid a cliff edge and get people back to work in a measured way. It extends the furlough scheme which allows firms to furlough employees with the Government paying cash grants of 80% of their wages up to a maximum of £2,500. That means more support for those businesses who need it to survive the economic disruption caused by the coronavirus.
The Scheme is just one part of our world-leading economic response to coronavirus. As we move into the second stage of our response, we are focussed not just on saving lives, but also saving livelihoods. That’s why we are taking unprecedented action to support businesses, jobs and our economy, by extending the Coronavirus Job Retention Scheme.
We will continue to do everything we can to ensure people can pay their bills and put food on the table. So as we begin to recover and return to our way of life, it is vital that we all stay alert, so we can control the virus and save lives.
In a boost to millions of jobs and businesses, Chancellor Rishi Sunak said the furlough scheme will be extended by a further four months. So until the end of October, workers will continue to receive 80% of their current salary, up to £2,500 a month.
From the start of August, the scheme will be more flexible, and furloughed workers will be able to return to work part-time with employers being asked to contribute towards some of the costs of their salaries.
The Coronavirus Job Retention Scheme has protected millions of jobs and businesses across the UK. The Chancellor has been clear that this Government wants to avoid a cliff edge, and make the process of returning to work as safe and smooth as possible. That's why we're extending the Job Retention Scheme to help people get back to work in a measured way. New statistics published this week revealed the Coronavirus Job Retention Scheme has already protected 7.5 million workers and almost 1 million businesses.
This extension and the changes we are making to the Scheme will give flexibility to businesses while protecting the livelihoods of the British people and our future economic prospects. More specific details and information around its implementation will be made available by the end of this month.
The Coronavirus Job Retention Scheme is just one part of the Government’s world-leading economic response to coronavirus, including an unprecedented package for the self-employed, loans and guarantees that have so far provided billions of pounds in support, tax deferrals and grants for small businesses.
The Government has published new statistics that show businesses have benefitted from over £14 billion in loans and guarantees to support their cashflow during the crisis. This includes 268,000 Bounce Back Loans worth £8.3 billion, 36,000 loans worth over £6 billion through the Coronavirus Business Interruption Loan Scheme, and £359 million through the Coronavirus Large Business Interruption Loan Scheme.
From the beginning, this Government has made sure it is following expert advice and following a step-by-step action plan – taking the right measures at the right time to help those who need it.
Mike Cherry, National Chairman of the Federation of Small Businesses, said:
The Job Retention Scheme is a lifeline which has been hugely beneficial in helping small employers keep their staff in work, and its extension is welcome. Small employers have told us that part-time furloughing will help them recover from this crisis and it is welcome that new flexibility is announced today.
Dame Carolyn Fairbairn, the Confederation of British Industry (CBI) Director-General, said:
The Chancellor is confronting a challenging balancing act deftly. As economic activity slowly speeds up, it’s essential that support schemes adapt in parallel.
Extending the furlough to avoid a June cliff edge continues the significant efforts made already and will protect millions of jobs.
Introducing much needed flexibility is extremely welcome. It will prepare the ground for firms that are reawakening, while helping those who remain in hibernation. That’s essential as the UK economy revives step-by-step, while supporting livelihoods.
Firms will, of course, want more detail on how they will contribute to the scheme in the future and will work with government to get this right.
Above all, the path of the virus is unpredictable, and much change still lies ahead. The Government must continue to keep a watchful eye on those industries and employees that remain at risk. All schemes will need to be kept under review to help minimise impacts on people’s livelihoods and keep businesses thriving.
The greater the number of good businesses saved now, the easier it will be for the economy to recover.
And the British Chamber of Commerce (BCC) Director-General Adam Marshall has said the following:
The extension of the Job Retention Scheme will come as a huge help and a huge relief for businesses across the UK.
The Chancellor is once again listening to what we’ve been saying, and the changes planned will help businesses bring their people back to work through the introduction of a part-time furlough scheme. We will engage with the Treasury and HMRC on the detail to ensure that this gives companies the flexibility they need to reopen safely.
Over the coming months, the Government should continue to listen to business and evolve the Scheme in line with what’s happening on the ground. Further support may yet be needed for companies who are unable to operate for an extended period, or those who face reduced capacity or demand due to ongoing restrictions.
We are past the peak of the coronavirus outbreak. But this is not the time to end the lockdown. We must take careful and deliberate measures, to ensure that we avoid a second peak which overwhelms the NHS. Because protecting the health and safety of the British public is, and must always be, our number one priority.
After almost two months of strong measures by this Government, we have prevented this country being engulfed by catastrophe, that in the reasonable worst case scenario was half a million fatalities. And it would be madness to throw away that achievement by allowing a second spike.
So we must stay alert. We must continue to control the virus. And, as a result, we will save lives.
Commenting, Therese Coffey, Secretary of State for the Department of Work and Pensions, said:
“Corbyn’s Pension Tax will see ten million savers facing a huge bill forcing them to delay their retirement for almost three and a half years.
“This is just one of the ways a Corbyn government would hammer hardworking people on top of his plans to hike up taxes by £2,400 a year, as well as the cost of his plan for unlimited immigration and the chaos of 2020 being dominated by two more referendums – one on Brexit and another on Scottish independence.
“Only Boris Johnson and the Conservative Party can get Brexit done with a deal, get parliament working again and turbocharge our economy to unleash Britain’s potential.”
Read more about how this Pension Tax will impact millions of savers (PDF)
