British public spend on furlough rises to £46.4 billion

  • December 20, 2020 05:51 AM AEDT
  • Hina Chowdhary
    Director, Equities Research Hina Chowdhary
    1413 Posts

    Hina Chowdhary is the Director, Equity Research at Kalkine and has an extensive experience of about 15 years in the area of Research, which includes 5+ years in Equities Research particularly.She has earned a Master of Science degree from the renowne...

British public spend on furlough rises to £46.4 billion

Summary

  • Around 9.6 million jobs have been secured under the popular Coronavirus Job Retention Scheme launched by the government in April
  • On Thursday, the government said it would extend the scheme until the end of April.

Recent government data has revealed that the British public spending on furloughing private sector employees reached a total value of £46.4 billion ($63.0 billion) on 13 December, up from £43.0 billion in the previous month.

The scheme is for those employees who were unable to work due to the pandemic outbreak. Till now, around 9.6 million jobs have been secured under the scheme, which was launched by the British Government in April 2020.

Further, the government guarantees to banks for lending to businesses increased to £68.15 billion as of 13 December, up from £65.48 billion in November.

The furlough scheme, which was earlier supposed to come to an end in October was first extended till 31 March. Now, the government has said it would extend it till the end of April, where the government will continue to contribute 80 per cent of the wages.

 

Interesting Read: Furlough extension: impact on UK economy and employment

 

UK Chancellor Rishi Sunak said that he would be extending the government-guaranteed Covid-19 business loan schemes until the end of March next year, in order to ensure that the firms can have access to the government’s support.

The change in the deadline of the schemes came ahead of the Budget, which will take place on 3 March. The extensions to the business loans and furlough schemes will deliver the next phase of the plan to tackle the crisis and protect jobs.

There will be no change in the eligibility criteria for the nationwide scheme and the UK government will continue to pay 80 per cent of the salary of employees until the scheme phases out. The National Insurance Contributions (NICS) and pensions for hours worked as well as hours not worked will be paid by the employers only.

Other schemes such as the Bounce Back Loan Scheme, Coronavirus Business Interruption Loan Scheme, and the Coronavirus Large Business Interruption Loan Scheme, which were due to end in January, will also be available for the businesses until the end of March.

 

Also Read: Why Are the Applications for UK’s Job Retention Scheme Slow?

 


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