Covid-19: furlough scheme to run till October

The Coronavirus Job Retention Scheme is to be extended by four months and employers will be able to bring back furloughed employees part-time, as part of the government’s plans to ‘re open the economy’, the Chancellor has announced

Addressing the House of Commons earlier today, Chancellor Rishi Sunak said: ‘The Coronavirus Job Retention Scheme will be extended by four months until the end of October.’

This extension will mean the government has provided a total of eight months of support to UK workers and businesses during the pandemic.

‘Workers will continue to receive the same level of support of 80% of their current salary, up to £2,500 a month’, said Sunak.

Over 7.5m jobs have been furloughed so far according to the Treasury.

Sunak said: ‘Until the end of July, there will be no changes whatsoever.

‘From August to October the scheme will continue for all sectors of the UK but with greater flexibility to support the transition back to work.’

He announced that employers using the scheme will be able to bring back furloughed workers part time, with full details to follow by the end of May.

However, Sunak made it clear that employers using the scheme would need to pay a share of the cost of salaries, along with government, if they wanted to bring back employees part-time.

Sunak added: ‘We stood behind workers and businesses as we came into the crisis, and we will stand behind them as we come out the other side.’

Mel Stride MP, chair of the Treasury Committee, said: ‘The extension of the furlough scheme, allowing furloughed employees to work part time, and with employers asked to contribute are all welcome steps from the Chancellor.

‘The devil though will be in the detail, which will be set out later this month when the Treasury Committee looks forward to carefully scrutinising these changes.

‘The Chancellor also said that there will be no changes to the scheme until July. This will be worrying for those who continue to fall through the gaps of the Government’s support measures such as the lack of furlough support to help cover dividend income generated through self employment.’

Further reading:

Five things you need to know: furlough and zero hours workers

80% rule salary payments liable for income tax and NICs

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