In the United Kingdom and the Chancellor of the Exchequer, Rishi Sunak (pictured), has unveiled a new program that is aiming to prevent any large-scale job losses in the wake of the nation’s recent partial return to coronavirus-related lockdown.
According to a report from the British Broadcasting Corporation (BBC), the Job Support Scheme was announced earlier today and is due to replace the country’s current furlough program from the first day of November. This new system has purportedly been designed so as to allow qualifying workers to receive at least 77% of their normal wages for six months in exchange for having to put in only one-third of their regular office hours.
The BBC reported that almost three million employees across the United Kingdom, which equates to about 12% of the nation’s total workforce, are currently on some form of home leave owing to the coronavirus pandemic with the government currently guaranteeing they receive 70% of their standard wages up to a monthly cap of £2,187 ($2,786). However, this contribution will purportedly drop to 60% from Wednesday complete with a £1,875 ($2,388) limit and had been set to end altogether come November.
Sunak reportedly told the BBC that his Job Support Scheme is part of a wider ‘winter economy plan’ that will ‘support only viable jobs’ as opposed to those which exist only because the government is subsidizing wages. The Conservative politician moreover purportedly detailed that the new program is destined to cost the national coffers about £300 million ($382 million) every month and will continue to temporarily pay employers a job retention bonus of £1,000 ($1,274) for every furloughed staff member they bring back into the office.
Sunak reportedly told the BBC…
“The primary goal of our economic policy remains unchanged, to support people’s jobs, but the way we achieve that must evolve. I cannot save every business and I cannot save every job.”
The BBC reported that the Job Support Scheme is to be open to small and medium-sized businesses with larger firms also able to take part so long as they can prove that their turnover has fallen during the coronavirus pandemic. The broadcaster furthermore explained that the program will require companies to pay their employees for the office hours that they work while partnering with the government to satisfy any subsequent shortfall up to a monthly cap of £697 ($889).
Finally, Sunak reportedly pronounced that he would be additionally extending the 15% coronavirus-induced cut in value-added tax (VAT) rates for hospitality and tourism companies until March and lengthen the term for such firms to re-pay government-backed ‘Bounce Back’ loans to ten years. The 40-year-old purportedly detailed that this latter four-year extension would furthermore be applied to small and medium-sized firms who borrowed emergency cash under the Coronavirus Business Interruption Loan Scheme.