Coronavirus update: Furlough scheme extension welcomed by business groups

May 12, 2020

Chancellor Rishi Sunak’s decision to extend the government’s Coronavirus Job Retention Scheme to October will be a “huge relief” to firms in the West of England, according to the region’s largest business group.

Business West, which runs the Swindon and Wiltshire Initiative, said its research showed the scheme, launched by Mr Sunak, pictured, in March, has become a key part of wider government support for businesses, with more than 70% of the firms it surveyed furloughing some of their staff. 

Business West managing director Phil Smith said: “The extension of the scheme will come as a huge help and a huge relief for businesses in South West England.

“The Chancellor is once again listening to what we’ve been saying, and the changes planned will help businesses bring their people back to work through the introduction of a part-time furlough scheme.”

He said Business West would engage with the Treasury and HMRC on the detail to ensure that it gives companies the flexibility the regions firms needed to reopen safely.

But he added that, over the coming months, the government needed to continue to listen to business and evolve the scheme in line with what is happening on the ground. “Further support may yet be needed for companies who are unable to operate for an extended period, or those who face reduced capacity or demand due to ongoing restrictions,” he said.

The extension has also been welcomed by national business organisations.

CBI director-general Dame Carolyn Fairbairn, pictured, said the Chancellor had confronted a challenging balancing act deftly.

“As economic activity slowly speeds up, it’s essential that support schemes adapt in parallel,” she said. 

“Extending the furlough to avoid a June cliff-edge continues the significant efforts made already and will protect millions of jobs.

“Introducing much-needed flexibility is extremely welcome. It will prepare the ground for firms that are reawakening, while helping those who remain in hibernation. That’s essential as the UK economy revives step-by-step, while supporting livelihoods.”

She said firms would want more detail on how they will need to contribute to the scheme in the future, but added: “Above all, the path of the virus is unpredictable, and much change still lies ahead.

“The government must continue to keep a watchful eye on those industries and employees that remain at risk. All schemes will need to be kept under review to help minimise impacts on people’s livelihoods and keep businesses thriving. 

“The greater the number of good businesses saved now, the easier it will be for the economy to recover.”

The chief executive of industry advice group Acas also welcomed the extension.

Susan Clews, pictured, said: “The Coronavirus Job Retention Scheme helps employers to retain their staff by covering wage costs during an exceptional crisis period where businesses’ incomes have been adversely impacted due to coronavirus.

“This extension will give a confidence boost to many businesses and staff who were nervous about their future after June.”



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