Chancellor extends furlough scheme to October

In a boost to millions of jobs and businesses, Rishi Sunak said the furlough scheme would be extended by a further four months, with workers continuing to receive 80 per cent of their current salary.

In announcing his decision, the Chancellor explained that from the start of August, furloughed workers will be able to return to work part-time, with employers being asked to pay a percentage towards the salaries of their furloughed staff.

The employer payments will substitute the contribution the government is currently making, ensuring that staff continue to receive 80 per cent of their salary, up to £2,500 a month.

“Our Coronavirus Job Retention Scheme has protected millions of jobs and businesses across the UK during the outbreak – and I’ve been clear that I want to avoid a cliff edge and get people back to work in a measured way,” Mr Sunak said. 

“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.”

New statistics published on Tuesday revealed the job retention scheme has protected 7.5 million workers and almost 1 million businesses.

According to the Chancellor, the scheme will continue in its current form until the end of July and the changes to allow more flexibility will come in from the start of August. More specific details and information around its implementation will be made available by the end of this month.

The government will explore ways through which furloughed workers who wish to do additional training or learn new skills are supported during this period. It has also promised to continue to work closely with the Devolved Administrations to ensure the scheme supports people across the Union. 

The Chancellor’s decision to extend the scheme, which will continue to apply across all regions and sectors in the UK economy, comes after the government outlined its plan for the next phase of its response to the coronavirus outbreak.

Applauding the Chancellor’s announcement, 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.”

The scheme is one part of the government’s economic response to the coronavirus, including a 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.