Mirror Online: LONDON, England – Rishi Sunak has confirmed the coronavirus furlough scheme will be extended until the end of March.
He said the Government aimed to end the national lockdown in England on December 2 as planned but furlough support would continue regardless.
In a major shift, Mr Sunak tore up his plan to cut off the scheme when the four-week lockdown ends and instead extended the scheme to March.
The scheme will apply across the UK, with upfront guaranteed funding for the devolved administrations to increase by £2 billion.
Mr Sunak said the measures were not tied to what tier an area is in if the country returns to the old system after the end of the national restrictions.
The Treasury will review the scheme in January and consider whether employers should contribute.
The self-employed income support grant will also increase from 55% to 80% of average profits – up to £7,500, the Chancellor announced in the Commons.
He said he hoped the measures would give businesses “immense comfort” ahead of a “difficult winter”.
And he rejected criticism over the u-turn, saying it was a “strength” to shift stance as circumstances change.
The Chancellor has made a number of changes to the job support scheme since September, prompting anger over job losses which might have been prevented if the changes had come in earlier.
He originally aimed to wind down the scheme before offering a reduced furlough of 67% of employee’s salaries in Tier 3 areas after a major wrangle with local leaders.
Attempts to move Greater Manchester into Tier 3 stalled for days after the Government refused to meet Andy Burnham’s demand for an 80% furlough in the region.
He was challenged by Wirral West MP Margaret Greenwood on why a bigger financial bailout was available once areas in the south needed to be locked down.
She accused him of treating people in the north as “second class citizens”.
But Mr Sunak rejected the criticism, saying: “It’s simply not the case that the wage support schemes we’ve put in place differentiate between people on the basis of where they live.”
Announcing the plan in the Commons, Mr Sunak said: “We can announce today that the furlough scheme will not be extended for one month, it will be extended until the end of March.
“The Government will continue to help pay people’s wages up to 80% of the normal amount. All employers will have to pay for hours not worked is the cost of employer NICs and pension contributions.
“We will review the policy in January to decide whether economic circumstances are improving enough to ask employers to contribute more.”
Mr Sunak said he had been forced to adapt support as the virus spirals across the UK into the winter months.
“I know that people watching at home will have been frustrated by the changes the Government has brought in during the past few weeks,” he said.
“I have had to make rapid adjustments to our economic plans as the spread of the virus has accelerated.”
Shadow Chancellor Annaliese Dodds accused her Tory counterpart of being “always a step behind”.
She said: “Now when the lockdown was announced, the Prime Minister said furlough would be extended for a month – five hours before that scheme was due to end.
“Two days later, realising the self-employed had been forgotten, there was a last-minute change to the self-employed scheme. And now, further changes.
“The Chancellor’s fourth version of his winter economy plan in just six weeks. The Chancellor can change his mind at the last minute, but businesses can’t.
“We need a Chancellor who is in front of the problems we face, not one who is always a step behind.”
Liberal Democrat Treasury spokesperson Christine Jardine went further, calling for the furlough to be extended to next June to offer greater certainty to businesses.
She said: “The Chancellor must put this in place immediately as, so far, his knee-jerk reactions have left far too many wondering how they will put food on the table, rather than ensuring no-one is left behind as he promised.”
TUC General Secretary Frances O’Grady said the extension of furlough was a “positive step” but raised concerns about the enduring gaps in the support package.
She said: “It’s not right to ask millions of low-paid workers on furlough to survive on less than the minimum wage. The Chancellor must fix the scheme so their pay is topped up to 100%.
“And he must offer to help to those self-employed workers who are falling between the cracks.
“We also need an urgent boost to both sick pay and universal credit. No-one should be plunged into financial hardship if they have to self-isolate or if they lose their job.”
Federation of Small Businesses National Chairman Mike Cherry said the intervention would give more certainty to businesses.
He said: “The ability to furlough staff on these terms until March will give employers an acutely-needed injection of confidence as they head into the festive period beset by disruption.
“Enabling firms in any location to furlough staff is a very welcome move.”