Rishi Sunak: There are no plans to extend furlough
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Furlough has supported millions of people throughout the COVID-19 crisis, keeping them in a job and paid, even when businesses were forced to shutter. Under the programme, formally known as the Coronavirus Job Retention Scheme, the Government offered Britons 80 percent of their salary up to £2,500 per month. This proved a vital lifeline for individuals unable to work due to their company being impacted by the pandemic.
In recent months, however, the Government has been moving towards winding down of the scheme – and there are fears about the consequences.
The Chancellor Rishi Sunak announced the scheme would end on September 30, 2021, and Government support has been gradually withdrawn – dropping now to 60 percent.
This has created an additional financial burden on companies, many of whom are worried about their future, and thus the future of their employees.
A new survey has found around one in every 16 businesses across the UK are at risk of closing over the next three months.
Furlough alert: One million jobs at risk as scheme ends – Britons ‘left in the lurch’ (Image: Getty)
Research by the London School of Economics has shown many businesses fear they may not be able to continue.
Although the numbers of people on furlough are dwindling, there could be some still at risk.
Currently, there are thought to be 1.9million Britons on furlough, which is three million fewer than recorded in March.
And with many still employed by struggling organisations, there could be challenges later down the line.
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This is coupled with the concern the Universal Credit £20 uplift which has been present throughout the pandemic is scheduled to be cut simultaneously.
Peter Lambert, an author of the research, told The Guardian the end of the furlough scheme would be an “inflection point” for the economy.
He added: “My bet is there will be more targeted support.
“Unless the economy really, really picks up, there’s going to be lots of people still left in the lurch in specific sectors.”
Furlough: What is furlough? (Image: EXPRESS)
With the furlough scheme ending, claims must also be made by companies.
Today is the deadline for furlough days in July 2021, while September claims must be submitted by October 14, 2021.
Employees cannot claim for themselves and the process must be enacted by their employer.
Recently, one trade union has called for a re-examination of furlough for the future.
The TUC has called upon the Government to introduce a “daughter of furlough” – a short-time working scheme.
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This, it says, could protect jobs in times of economic crisis and change.
The union has said the Government must build on the success of furlough by setting up a permanent scheme to deal with future disruptions.
A Treasury spokesperson told Express.co.uk: “We deliberately went long with our support to provide certainty to people and businesses over the summer; and that support is continuing with reduced business rates and cuts to VAT in place until March 2022, and the furlough scheme running until the end of September.
“The Universal Credit uplift was always intended to be a temporary measure to help households through the pandemic, but we are continuing to support people and ensure they have the skills and opportunities they need to get great jobs.
“We’ve invested billions in our Plan for Jobs, which is already getting people back into employment and learning new skills, and businesses can also continue to access other support including our Recovery Loan scheme.”