Chancellor extends furlough job retention scheme until end of October

Speaking in the House of Commons today, Sunak said the scheme would not be altered until the end of July. He said from August, the government would expect employers of furloughed staff to make a contribution to their pay.

The chancellor introduced the scheme in March with the government contributing up to 80% of a furlough employee’s salary or up to £2,500 a month until the end of June.

He said since announcing the scheme, 7.5 million people have been furloughed on it from almost 1 million businesses.

Sunak told the Commons that from August, businesses will be able to bring staff back on a part-time basis – at the moment the scheme only subsidises workers who are not working.

In a tweet, Sunak said further details around how much employers would be asked to contribute to furloughed staff beyond July would be published by the end of May.

Many businesses had been concerned that Sunak would look to reduce the amount of support being offered to furloughed workers below 80% as a means of trying to encourage many businesses to follow the government’s advice about getting people who cannot work from home back to work.

The TUC welcomed the chancellor’s announcement. General secretary Frances O’Grady said: “We are pleased ministers have listened to unions and extended the job retention scheme to the autumn. This will be a big relief for millions.

“Changing the rules to allow part-time working is key to enabling a gradual and safe return to work. Maintaining the rate at 80% is a win for the pay packets of working families.

“As the economic consequences of Covid-19 become clear, unions will keep pushing for a job guarantee scheme to make sure everyone has a decent job.”