Chancellor extends furlough to April 2021
Chancellor Rishi Sunak has extended the furlough scheme for one month until the end of April 2021.
He said the move would provide “certainty for millions of jobs and businesses” with the Government continuing to pay up to 80% of the wages of workers who have been furloughed under the Job Retention Scheme. In addition, Government have also confirmed they will be extending the government-guaranteed Covid-19 business loan schemes until the end of March 2021.
With a new budget confirmed for 3rd March 2021, the package of support will mean a huge difference for many businesses uncertain about the start of the New Year.
Commenting earlier today, Sunak stated “Our package of support for businesses and workers continues to be one of the most generous and effective in the world – helping our economy to recover and protecting livelihoods across the country. We know the premium businesses place on certainty, so it is right that we enable them to plan ahead regardless of the path the virus takes, which is why we’re providing certainty and clarity by extending this support.”
The government will continue to pay up to 80% of the salary of employees for hours not worked until the end of April 2021, with a cap of £2,500 a month.
Employers will only be required to pay the wages, National Insurance (NI) contributions and pensions for hours worked, as well as NI contributions and pensions for hours not worked.
The Coronavirus Job Retention Scheme has supported 9.6 million jobs across the UK, with more than one million businesses using it. In a recent BPMA survey, 89% of members confirmed they had accessed the scheme with 65% accessing the extended furlough scheme. 22% of those using the scheme were using it for the first time and only 8% of those surveyed said they had not accessed this Government support for their employees.
Bounce Back Loans
Due to end in January 2021, businesses will also have until the end of March to access the Bounce Back Loan Scheme (BBLS), Coronavirus Business Interruption Loan Scheme (CBILS) and the Coronavirus Large Business Interruption Loan Scheme. To date, £68bn has already been provided in guaranteed loans to firms.
Business Secretary Alok Sharma said: “Extending government-backed loan schemes will give companies right across the UK the finance they need to support, protect and create jobs as we build back better from the pandemic.”