Uncertainty over further extensions of the furlough scheme leaves UK businesses and workers concerned for the future.
The furlough scheme (Coronavirus Job Retention Scheme) is set to run until 30 April 2021, but with the current national lockdown, many are seeking clarity on whether the scheme will be rolled out any longer, or what the next steps will be.
Since it was launched on the 20th April 2020, employers across the country have relied on the scheme in order to avoid making mass redundancies. As of December 13th 2020, 1.2m employers had utilised the furlough scheme, with £46.4bn worth of claims made overall.
For many businesses, the furlough scheme has been integral to their operations, and one of the reasons they are still able to operate. Adam Reed, the owner of a Birmingham-based brewery, said: “I feel lucky that furlough has been an option and that we haven’t had to resort to redundancies. But I’m not sure what will happen if the scheme does end soon. We’re trying to prepare for the worst, but not knowing what support we will have access to in advance makes it hard to plan.”
Anxiety over the continuation of the scheme is particularly pressing for those employees who are currently furloughed. As of December 13th 2020, the number of workers that had been furloughed in the UK amounted to 9.9m. Connor Henderson is a Graphic Designer who has been on furlough, or flexible furlough, since April. He explained how lucky he feels to have been able to keep his job in an “industry that has taken a big hit in the pandemic,” saying that, “from the beginning, furlough was vital for me and my employer. ” He added that he hopes not to rely on it for too much longer, but he feels uncertain and is really hoping for an extension of the scheme.
Further information about the future of the furlough scheme and how businesses will be supported is expected to be announced after the Chancellor announces the Budget on March 3rd. There has been speculation that the scheme could be extended or a new, tapered support system could be brought in for businesses.
A researcher at the Resolution think tank, Charlie McCurdy, said that: “The Job Retention Scheme has been a living standards lifeline for millions of workers, with three in 10 private-sector workers furloughed at the peak of the first lockdown.”
Currently, employers are able to furlough their staff on a flexible basis, as long as they continue to pay their employee’s National Insurance contributions and pension costs.