Furlough follow up....

The Financial Times has reported that the Chancellor of the Exchequer, Rishi Sunak, is considering a new style job-subsidy scheme for when the Coronavirus Job Retention Scheme ends on 31st October 2020.

One possibility that has gained a lot of traction, proposed by the Confederation of British Industry, is a state-subsidy but only if an employer is able to offer workers at least 50% of their normal hours. In this situation, the company would meet the full wage bill for the hours worked by an employee, but for non-working hours, the wage bill would be shared: a third paid by the company, a third by the Treasury and a third foregone by the employee. The TUC has proposed a similar scheme, but with workers continuing to receive 80% of their pay for the time they are not working, or 100% if they are on minimum wage.

Prime Minister Boris Johnson has indicated that a variety of “creative and imaginative measures” are being considered by the Chancellor, with the Government taking into account existing schemes in France, Germany and Spain aimed at helping companies that can’t bring back employees on a full-time basis due to the economic downturn.

The Government's official position remains, at least for now, that the existing furlough scheme, that has cost £39.3bn up to September 2020, will end on 31 October 2020 and that it will look at targeted assistance only after that date.