The furlough scheme will be extended until the end of March.
Rishi Sunak said in the House of Commons on Thursday that the government will continue to pay 80% of wages as the UK enters a second lockdown.
“We can announce today that the furlough scheme will not be extended for one month, it will be extended until the end of March,” said Sunak today.
“The government will continue to help pay people’s wages up to 80% of the normal amount. All employers will have to pay for hours not worked is the cost of employer NICs and pension contributions.
“We will review the policy in January to decide whether economic circumstances are improving enough to ask employers to contribute more.”
Sunak also confirmed that the support for those self-employed will be more generous. The government will pay 80% of the average profits up to £7,500.
“I also want to reassure the people of Scotland, Wales and Northern Ireland. The furlough scheme was designed and delivered by the government of the United Kingdom on behalf of all the people of the United Kingdom, wherever they live,” he said today.
“That has been the case since March, it is the case now and will remain the case until next March.
“It is a demonstration of the strength of the union and an undeniable truth of this crisis we have only been able to provide this level of economic support because we are a United Kingdom.
“And I can announce today that the upfront guaranteed funding for devolved administrations is increasing from £14bn to £16bn. This Treasury is, has been and will always be the Treasury for the whole of the United Kingdom.”
Frances O’Grady, the TUC general secretary, responded to the chancellors statement and said: “Agreeing to extend the job retention scheme at 80% until the spring, as unions have called for, is a positive step.
“But there are still gaps in the government’s support package. It’s not right to ask millions of low-paid workers on furlough to survive on less than the minimum wage. The Chancellor must fix the scheme so their pay is topped up to 100%.
“And he must offer to help to those self-employed workers who are falling between the cracks. We also need an urgent boost to both sick pay and universal credit. No-one should be plunged into financial hardship if they have to self-isolate or if they lose their job.”