The Government will extend furlough payments at 80% for the duration of the new national lockdown measures in England, Boris Johnson has said.
The Prime Minister said, during a Downing Street press conference, that he was sorry about the hardship that businesses have already endured this year.
Following the PM’s announcement on further restrictions across the country we have decided to extended the furlough scheme for a further month covering 80% of employees’ wages. pic.twitter.com/qqlpu6wcI6
— Rishi Sunak (@RishiSunak) October 31, 2020
He said: “That’s why we are going to extend the furlough system through November. The furlough scheme was a success in the spring and supported people in businesses in a critical time.
“We will not end it, we will extend furlough until December.”
It will have some differences to March in that these measures will be “time-limited”, starting on November 5 and ending on December 2.
This is when the Government will seek to “ease restrictions” and go back into the tiered system.
Non-essential retail and hospitality services will be forced to close, while schools stay open during the four-week lockdown.
It means that pubs, cafes, restaurants will shut except for takeaway and delivery services.
TUC general secretary Frances O’Grady said that families are being forced to face a “grim winter” because the Government did not act decisively sooner.
She said: “The extension of the furlough scheme is long overdue and necessary, but ministers must do more to protect jobs and prevent poverty.
“Furlough pay must never fall below the national minimum wage.”
She stressed that a boost to Universal Credit is needed and Government must not “abandon” the self-employed.
There were also calls from business leaders for the test and trace system, a key weapon in the fight against the virus, to be fixed so that workers are not asked to self-isolate without decent sick pay.
Jonathan Geldart, the director general of the Institute of Directors, said the new restrictions would inflict “great strain on an already fragile business community”, but the extending furlough would be a relief to many firms.
He added: “With the return of restrictions, gaps in government support need sorted at long last. Small company directors who have gone without support throughout the crisis should be helped through local authority grants.”
Both the British Retail Consortium chief executive Helen Dickinson and Jace Tyrrell, the chief executive of the New West End Company, described the lockdown as a “nightmare before Christmas”.
Ms Dickinson feared: “It will cause untold damage to the high street in the run up to Christmas, cost countless jobs, and permanently set back the recovery of the wider economy, with only a minimal effect on the transmission of the virus.”
She said the previous previous lockdown cost non-essential shops £1.6 billion a week in lost sales and expect the impact to be event greater as the retail sector is entering the all-important Christmas shopping period.
Many retailers have spent thousands of pounds to become Covid-safe and now there could be “a significant economic impact on the viability of thousands of shops and hundreds of thousands of jobs across the country,” she suggested.
Mr Tyrrell pointed out that the West End employs one in 10 Londoners and this year’s run up to Christmas is shaping up to deliver “some of the most difficult trading periods we’ve ever experienced”.
He said: “Retailers and the public need to be reassured that there is light at the end of the tunnel, as continued uncertainty and stop start measures are undermining confidence and worsening an already catastrophic situation.”