Rishi Sunak likely to extend furlough scheme till September end


Chancellor of the Exchequer Rishi Sunak (Photo: DANIEL LEAL-OLIVAS/AFP via Getty Images)
Chancellor of the Exchequer Rishi Sunak (Photo: DANIEL LEAL-OLIVAS/AFP via Getty Images)

THE UK government is likely to extend its furlough scheme – reportedly at a lower rate of 60 per cent of the wages – until the end of September, say reports.

Chancellor Rishi Sunak is set to make the final announcements on Tuesday (11) as part of its plans to reboot the economy.

The Telegraph reported that “Cabinet ministers have begun telling bosses that the coronavirus job retention scheme will continue throughout the summer”, even as talks were on to arrive at a concrete package.

The job retention scheme had initially been planned till May, but the crisis forced the government to push it until June.

Sunak was also considering plans to “top up” wages of furloughed employees getting back to work on a part-time basis.

The government could also provide incentives to “slowly and cautiously” bring workers back and resume operation while adhering to social distancing and other guidelines.

The chancellor had made it clear that the job retention scheme – costing the government about £16 billion a month – would have to be wound up gradually.

“There will be no cliff edge to the furlough scheme,” said Sunak.

Reports noted that about half of the Britain’s adult population was being bankrolled by the state, and analysts predicted the bill could eventually overtake the expenditure on the NHS.

“This furloughing is unsustainable for an extended period of time,” Sir Lloyd Dorfman, the founder of bureau de change firm Travelex, told The Telegraph. “I think they’re going to start to unwind it. And I think they’ve got to; they’ve got to get economic activity back happening again.”

Edwin Morgan, director of policy at the Institute of Directors, said getting “people to return to work gradually can help businesses get back on their feet”.

He, however, stressed that the government should be “agile with its support”, considering the challenges of the current times.

A Treasury spokesman noted that the furlough scheme was “an absolutely crucial element of our financial support in protecting jobs and businesses through this crisis”.

“Future decisions around the scheme will take into account the wider context of any lockdown extension, as well as the public health response, so that people and businesses can get back to work when it is safe to do so,” he added.