Chancellor expected to announce further furlough details

By Nikkie Thatcher

- Last updated on GMT

Government support: Chancellor Rishi Sunak has faced calls for the furlough scheme to be extended
Government support: Chancellor Rishi Sunak has faced calls for the furlough scheme to be extended

Related tags coronavirus

Chancellor of the Exchequer Rishi Sunak is expected to reveal the future of the furlough scheme later today (Tuesday 12 May), amid calls for it to be extended.

The Coronavirus Job Retention Scheme (CJRS) has already been extended once​ – from the end of May to the end of June.

The Prime Minister said yesterday (Monday 11 May) the scheme was “one of the most remarkable features of the Government’s response” and was “absolutely right that we do it”. He followed this by saying Sunak would update MPs on Tuesday (12 May).

The scheme, which allows businesses to furlough employees with the Government paying cash grants of 80% of their wages up to a maximum monthly pay of £2,500, was originally open for three months and backdated from 1 March until the end of May.

The latest figures from the Government found the scheme had cost £8bn so far and HMRC said 6.3m jobs had been temporarily laid off by 800,000 businesses, by Sunday 3 May.

Further support

Trade bodies UKHospitality (UKH) and the British Beer & Pub Association (BBPA) urged the Government to provide further support when it came to furloughed staff, insurance companies, grants, rent and loans.

Sunak outlined his plans to phase out the scheme​ to ITV News ​​last week (Monday 4 May) as restrictions look to be eased.

He said: “To anyone anxious about this, I want to reassure them there will be no cliff-edge to the furlough scheme.

“I’m working, as we speak, to figure out the most effective way to wind down the scheme and ease people back into work in a measured way.

“As some scenarios have suggested, we are potentially spending as much on the furlough scheme as we do on the NHS, for example. Clearly, that is not a sustainable situation.”

Government plan

This follows Prime Minister Boris Johnson’s announcement (Sunday 10 May) of the phased plan to ease lockdown restrictions, including encouraging those who are able to and can’t work from home, to return to work.

The third phase, which is set to take place from 1 July, would mean some hospitality businesses and public spaces reopen, however, Johnson did not specify which.

The Government then released (Monday 11 May) its Our Plan to Rebuild: The UK Government’s Covid-19 recovery strategy​ document, which stated it was hoping to open businesses including some pubs this summer (4 July) but they should meet the Covid-19 secure guidelines.

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