[Denver]

https://www.theguardian.com/world/20...heme-from-july

The chancellor, Rishi Sunak, is preparing to wind down the coronavirus wage-subsidy scheme for workers from July as part of government plans to gradually remove lockdown measures.

In a sign of the mounting costs to the exchequer with almost a quarter of employees in Britain furloughed in the past fortnight, the chancellor is expected to announce that the Covid-19 job retention scheme will be steadily scaled back as restrictions on business activity are lifted.

The Treasury is understood to be examining several options for tapering the scheme, including cutting the 80% wage subsidy paid by the state to 60% and lowering the £2,500 cap on monthly payments. Another option promoted by employers’ groups to allow furloughed staff to work, but with a smaller state subsidy, is also under consideration.

Sources indicated that a final decision has yet to be made, but the Treasury was working closely with No 10 as Boris Johnson prepares to outline plans on Sunday to gradually lift lockdown restrictions. After more than a month of tight controls on social and business activity across Britain and in other countries around the world, the UK is on the brink of the deepest recession in living memory.

Sunak is expected to announce details of the plan before the middle of May, because employers making more than 100 staff redundant must run a 45-day consultation before making any job cuts.

With the furlough scheme due to close at the end of June, firms will need to start making decisions from as early as next week, piling pressure on the chancellor to provide refreshed guidelines or face a wave of potential job losses.

Employers groups have called for the chancellor to make urgent changes to the scheme to remove the risk of a “cliff edge” closure to the wage subsidy programme at the end of June, warning that it risks becoming a “waiting room” for redundancies otherwise.

Sunak used a television interview on Monday to promise there would be no cliff edge. He told ITV: “I’m working, as we speak, to figure out the most effective way to wind down the scheme and to ease people back into work in a measured way.”

Figures released this week by HMRC showed that a total of 6.3m jobs have been temporarily laid off by 800,000 companies, as firms across the country flock to take advantage of the job subsidy scheme.

Launched on 20 April, the programme involves the Treasury paying 80% of the wages of workers up to a maximum of £2,500 per month to prevent them being laid off by their employers.

Given rapid take up of the scheme, the costs to the public purse have steadily spiralled into the billions. HMRC said the total value of claims so far amounted to £8bn by 3 May.

The government’s tax and spending watchdog, the Office for Budget Responsibility, has estimated that the scheme could cost £42bn over three months if as many as 8.3 million people are furloughed at an 80% subsidy. It could cost a further £12bn for each additional month at this level, according to the Resolution Foundation.

[Samm]

lol

typical tories :/

[Denver]

Originally Posted by Samm

lol

typical tories :/

They cant keep it going for £16b a month

[Oliver_W]

Wasn't June around the time it was always projected to be wound back?

[Samm]

Originally Posted by WickedSkengMan

They cant keep it going for £16b a month

So employees will have to go unpaid then? If the they can spend £38.03B on the military yearly with no need because there is much more real threats then any unrealistic war, they have the funds to help employees and employers until a detailed plan on returning to work is made clear

I know a statement is meant to be made on Sunday, however until then and all employers know when they can adjust back. The scheme which I supported should be in place.

[Denver]

Originally Posted by Samm

So employees will have to go unpaid then? If the they can spend £38.03B on the military yearly with no need because there is much more real threats then any unrealistic war, they have the funds to help employees and employers until a detailed plan on returning to work is made clear

I know a statement is meant to be made on Sunday, however until then and all employers know when they can adjust back. The scheme which I supported should be in place.

They are planning on reopening the country and have made it clear that employers can not sack staff for at least 45 days and had a consultation with the government

[Cherie]

It will be wound down in July, the scheme was extended to end June a few weeks ago...and it will be phased, employees of businesses not yet allowed back to work will continue to be supported though it may be 60% rather than 80%

Change your title Adam

[user104658]

Reading between the lines of this, though... They cannot afford to extend furlough arrangements beyond the next few months, which means if (when) there is another upsurge in cases late in the year they can't realistically fund a second furlough scheme.

[Cherie]

Originally Posted by Toy Soldier

Reading between the lines of this, though... They cannot afford to extend furlough arrangements beyond the next few months, which means if (when) there is another upsurge in cases late in the year they can't realistically fund a second furlough scheme.

I think they will but with stricter criteria, too many companies jumped on this who could pay their staff, now they have had more time I think they would roll out a scheme that is less open to that

[user104658]

Originally Posted by Cherie

I think they will but with stricter criteria, too many companies jumped on this who could pay their staff, now they have had more time I think they would roll out a scheme that is less open to that

Yes I've seen companies where a staff member has gone off sick with, essentially, lockdown-related stress and anxiety and really should have been paid regular sick leave or compassionate leave but have been "furloughed for a month" instead. I can understand why that might happen, it's tempting for small companies who are already struggling financially and also it sucks for people to have to use up their annual sick pay allowance for this (especially with it just being the start of a new financial year) but it's not ideal.

I think at the very least, should it be needed again going forward, they should also introduce temporary new sick pay rules that mean if someone needs to take time off for personal lockdown-related reasons, or to self isolate etc., it shouldn't be counted against their quota of available sick days.

[Scarlett.]

While I would prefer to still get the 80%, I understand why they have to lower it to 60%, and at the end of the day, it's better than nothing at all