Rishi Sunak: There are no plans to extend furlough
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Rishi Sunak ruled out plans for a further extension of the Coronavirus Job Retention Scheme. The Chancellor the Exchequer was asked about the end date for furlough during a LinkedIn broadcast.
“Furlough, we put in place a year ago, our plan for jobs. Everything I see, shows me that the plan is working,” he said.
“Furlough we know has helped save millions of jobs, people have described it as a lifeline, a Godsend.”
He added: “The jobs numbers are heading in the right direction.
“Unemployment is forecast to be so much lower than we thought, when we were fearing the absolute worst.
Furlough end date: Rishi Sunak has confirmed the scheme will not be extended (Image: GETTY)
“There are no plans to extend furlough, it will have run for a year and a half.
“We made the decision back in March at Budget to extend it, quite comprehensively and generously, all the way through to the Autumn.
“Most people thought, ‘Gosh that was a bit long’, but I thought it was the right thing to do to give businesses that certainty.
“I am confident that with the pace of the economic reopening and people’s hiring intentions, the vast majority of people will be able to come back to work.
“But not everyone will be able to… I said right at the beginning of this criss, no matter what we do, I wouldn’t be able to save every job, I don’t think any Chancellor could.”
Under the furlough scheme, eligible furloughed employees receive 80 percent of their wages, capped at £2,500 per month, for the type spent on furlough.
However, as lockdown restrictions have eased, changes to the scheme have come into force.
From July 1 last month, the level of grant covered by the Government has reduced, meaning employers have had to make up the difference.
Furlough end date: Changes to the scheme are taking place (Image: GETTY / EXPRESS)
As well as making employer National Insurance contributions and pension contributions, from July 1, employers have had to contribute 10 percent of wages for hours not worked, up to £312.50 per month.
Meanwhile, the Government has contributed the remaining 70 percent of wages, up to £2,187.50 per month.
Further changes have come into force this month, with the Government contribution on wages for hours not worked dropping to 60 percent, up to £1,875 per month.
Employer contributions on wages for hours not worked stand at 20 percent, up to £625, in August 2021.
Concern about the end of the furlough scheme was raised recently, following new research into the number of people aged over 50 who are on furlough.
Stuart Lewis, Founder of Rest Less, commented: “The country is reopening, and the total number of people on furlough is falling quickly – by three million since the beginning of the year.
“However, the recovery is clearly not working for everyone, with more than 630,000 people aged over 50 still on furlough and waiting to find out if they have a job to go back to. This is in addition to the 568,000 over 50s claiming job seeking or out of work benefits.
“When the furlough scheme draws to a close next month, we’re expecting it to be accompanied by a fresh wave of redundancies and another spike in unemployment levels – delivering another blow to workers in their 50s and 60s.”