Chancellor Rishi Sunak has reportedly refused to extend the furlough scheme despite repeated pleas from businesses. The coronavirus job support scheme will continue to cover a portion of people's salaries until September. However, the government will stop covering 80 per cent of wages for those not at work from July, as employers are forced to start contributing more. Sunak said businesses will have to contribute 10 per cent of the cost from July, increasing to 20 per cent in August and September as the economy hopefully reopens.
Businesses have urged the Chancellor to delay the withdrawal of funds if lockdown is extended beyond June 21. However, sources close to Sunak insisted the timetable for gradually phasing out furlough would remain the same. It is argued that an extension until September was enough to cover any delay to Britain's unlocking and that the Treasury had already “gone long”.
Relief for retail, hospitality and leisure facilities will drop from 100 per cent to 66 per cent from July 1 and remain in place until the end of March next year. The industry has urged Sunak to reconsider his plans and keep full relief in place until the start of October.
Trade body UK Hospitality chief executive Kate Nicholls was quoted in a report as saying, “We recognise that the Chancellor has provided long-term support for the sector which extends into the recovery period, but there is no doubt that any extension to the restrictions will be challenging for sectors yet to open and those still trading at a loss to navigate.” She added, “Among other measures, the Government must postpone business rates payments until at least October and extend the rent moratorium while a long-term solution is found. Businesses need a swift, publicly-stated commitment that such support will be in place in the event of any delays, giving them much-needed reassurance after more than 15 months of closure and severely disrupted trading.”
“Hospitality is desperate to get back to what it does best and can play a key role in the economic recovery of the UK – but only if it is given the proper support.”
