Chancellor mulls further furlough extension
As first reported by Bloomberg, an extension of the £60bn furlough scheme, which is currently set to run until the end of April, is an option 'under consideration' as one of a list of support measures to be announced in the 3 March Budget.
The JRS was originally introduced at the onset of the pandemic.
In its current form the scheme pays 80% of employee wages up to £2,500 a month, although employers are required to cover the costs of pension and National Insurance contributions.
The exact form of the measures set to be introduced by the Chancellor in March will depend on how the Covid-19 pandemic evolves over the six weeks.
According to one source, boosting employment will be at the centre of the budget and 'support for jobs isn’t going to end'.
Officials are also still exploring policies similar to the Job Retention Bonus and the Jobs Support Scheme, two programs that were announced last year but then scrapped when furlough was extended.
Restoring the Job Retention Bonus, which sought to encourage firms to hold on to staff by offering them a one-off payment of £1,000 for every furloughed staff member still employed six months later, is one of the measures UKHospitality has been calling for as a way of enabling businesses in the sector to spearhead country’s economic revival.
In a letter to the Chancellor sent earlier this week, the trade body set out additional action it says is needed to accelerate the revival of the UK’s hospitality sector and slash unemployment.
This includes extending the VAT cut to 5% for a further 12 months, and enacting a further business rates holiday for hospitality for the 2021/22 financial year.
The Confederation of British Industry (CBI) has also called on the Government to announce extensions to business support measures this week, in order to ensure the survival of firms until the economy reopens.
In his own letter to the Chancellor, CBI director-general Tony Danker called for the furlough scheme, business rates holiday and deferral of VAT to be extended until at least the summer.
He added that the announcement of such extensions will be needed in the next few weeks, ahead of the Budget, to help protect UK companies through the Spring.
Commenting on the forthcoming March Budget, the Treasury said: “The Government will set out how we’ll ensure public services continue to receive the investment they need.
"We’ll also outline the next stages of our plan for jobs to support businesses and families across the UK. That has been our priority throughout the past year and it will be the priority for the year to come.”
