Workers across the UK will benefit from increased support with a five-month extension of the furlough scheme into Spring 2021, the Chancellor has announced
The Coronavirus Job Retention Scheme (CJRS) will now run until the end of March with employees receiving 80% of their current salary for hours not worked.
Similarly, support for millions more workers through the Self-Employment Income Support Scheme (SEISS) will be increased, with the third grant covering November to January calculated at 80% of average trading profits, up to a maximum of £7,500.
- businesses and people across the UK given certainty over winter months with further support announced by Chancellor Rishi Sunak
- the furlough scheme will now be extended until the end of March – protecting millions of jobs across all nations
- the next self-employed income support grant will also increase from 55% to 80% of average profits - up to £7,500
The Chancellor also announced an increase in the upfront guarantee of funding for the devolved administrations from £14bn to £16bn. This uplift will continue to support workers, business and individuals in Scotland, Wales and Northern Ireland.
The furlough scheme was initially extended until 2 December. But the government is now going further so that support can be put in place for long enough to help businesses recover and get back on their feet – as well as giving them the certainty they need in coming months. Evidence from the first lockdown showed that the economic effects are much longer lasting for businesses than the duration of restrictions.
There are currently no employer contribution to wages for hours not worked. Employers will only be asked to cover National Insurance and employer pension contributions for hours not worked. For an average claim, this accounts for just 5% of total employment costs or £70 per employee per month. The CJRS extension will be reviewed in January to examine whether the economic circumstances are improving enough for employers to be asked to increase contributions.
The furlough scheme has protected over nine million jobs across the UK, and self-employed people have already received over £13bn in support. This is in addition to billions of pounds in tax deferrals and grants for businesses.
In additin, the government has announced:
- cash grants of up to £3,000 per month for businesses which are closed worth more than £1 billion every month
- £1.1 bn is being given to Local Authorities, distributed on the basis of £20 per head, for one-off payments to enable them to support businesses more broadly
- plans to extend existing government-backed loan schemes and the Future Fund to the end of January, and an ability to top-up Bounce Back Loans
- an extension to the mortgage payment holiday for homeowners
- up to £500m of funding for councils to support the local public health response
More details can be found at: www.gov.uk/government/organisations/hm-treasury