Extending furlough until Spring 2021 and increasing self employment support will help protect millions of jobs

People gather in the sunshine on Lord Street and Nevill Street in Southport town centre
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Workers in Southport and across the UK will benefit from increased support with a five-month extension of the furlough scheme into Spring 2021, the Chancellor announced today, (5 November).

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 from 55% to 80% of average profits.

The third grant covering November to January will be calculated at 80% of average trading profits, up to a maximum of £7,500.

Southport MP Damien Moore said: “I am delighted to see the new measures being announced today which will provide much-needed security to many businesses, employees and self-employed workers here in Southport and across the country.

“As we begin a four week period of new lockdown restrictions and look forward to the Christmas season, it is vital that jobs and livelihoods are protected as much as possible and that local firms and people can begin to plan ahead.

“I would like to thank local residents and businesses in Southport for their efforts to help control this virus, while significant efforts are made to introduce mass Covid testing - with the pilot programme currently taking place in Liverpool - while work continues to produce and distribute a vaccine.”

The Chancellor of the Exchequer Rishi Sunak said: ”I’ve always said I would do whatever it takes to protect jobs and livelihoods across the UK - and that has meant adapting our support as the path of the virus has changed.

“It’s clear the economic effects are much longer lasting for businesses than the duration of any restrictions, which is why we have decided to go further with our support.

“Extending furlough and increasing our support for the self-employed will protect millions of jobs and give people and businesses the certainty they need over what will be a difficult winter.”

The Chancellor also announced today an increase in the upfront guarantee of funding for the devolved administrations from £14 billion to £16 billion. 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 contributions 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.

Throughout the pandemic, the government has acted with speed to protect lives and safeguard jobs with an unprecedented £200 billion support package. The furlough scheme has protected over nine million jobs across the UK, and self-employed people have already received over £13 billion in support. This is in addition to billions of pounds in tax deferrals and grants for businesses.

On top of this, 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 billion 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 £500 million of funding for councils to support the local public health response.