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Chancellor considering furlough scheme replacement – reports

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  • 23/09/2020
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Chancellor considering furlough scheme replacement – reports
Chancellor Rishi Sunak (pictured) is reportedly considering a wage subsidy initiative to replace the furlough scheme once it ends in October.

 

Similar to initiatives operated by the French and German governments, the scheme may see employees work 50-60 per cent of their normal hours and have the wages for their unworked hours topped up by the state. 

Plans for what will happen once the furlough scheme closehave not been confirmed, but foreign secretary Dominic Raab suggestesupport targeted to specific sectors was being considered.  

Speaking to Sky News, Raab said: “The chancellor is keeping all of that under constant review, not just economy wide, but the specific sectors affected. 

“I don’t think the chancellor’s minded to wholesale extend the furlough scheme. We are looking at the targeted measures and keep them constantly under review.” 

Raab’s comments follow a similar statement made by Bank of England governor Andrew Bailey who also said continued support should be for specified workforces. 

Speaking at an online event for the British Chambers of Commerce yesterday, Bailey said Sunak should rethink the initiative but added a “blanket scheme” covering all sectors was not needed going forward. 

Bailey said: “[Furlough] has helped manage the shock, to firms and to labour [but now] the use of it, as far as we can tell, is more concentrated. 

“I think it is therefore sensible to stop and rethink the approach going forward, without any commitment to what that might be.” 

Mortgage Solutions has contacted the Treasury for comment.

 

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