The government’s coronavirus furlough scheme will be ending today after supporting millions of the nation’s workers during the coronavirus pandemic
The Furlough scheme has been hailed by many as one of the government’s big successes during the COVID-19 pandemic, but now that it’s ending there are fears that it could spark mass job losses.
The government’s coronavirus furlough scheme will be ending today after supporting millions of the nation’s workers during the coronavirus pandemic.
Ministers have said that the wages of over 11 million jobs had been subsidised for at least some of the job retention scheme’s duration, at a cost of around £70bn.
There is now a lot of uncertainty over the almost one million people still thought to be on the government’s scheme at the end of September, according to the Office for National Statistics (ONS) estimates.
This comes after the business secretary has said that soldiers will be delivering fuel in the next couple of days to ease petrol supply issues. Kwasi Kwarteng, the UK’s business secretary, has admitted that the past few days, which have seen long queues outside petrol stations and some pumps running dry, had been “difficult”.
Meanwhile, job vacancies within the UK have hit a record of more than a million people, according to recent ONS data, with openings within boith the hospitality and transport sectors being up by more than 75% in three months.
Simon Clarke, the Chief Secretary to the Treasury, has said on the matter: “There is a lot of opportunity out there for people now. There’s never an easy moment to end these measures.
“They’ve been hugely important but it is also time to recognise that we are now, thankfully, out of the teeth of this pandemic… and we’re in a situation where normal opportunity is back out there for people to embrace.”
But economists have said that there is likely to be a rise in unemployment due to new redundancies, despite the fact that some may be able to find work in the nation’s recovering sectors such as travel and hospitality.
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Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said he still had “doubts” about whether the economy had recovered enough to re-employ all those coming off furlough.
The winding up of the scheme could hit some especially hard as it comes at the same time as the £20 Universal Credit uplift ends, and amid a background of rising energy bills.
The Liberal Democrats have warned of a “tidal wave” of job losses and want furlough to continue for some sectors.
In a letter to the chancellor, Liberal Democrat Treasury spokesperson Christine Jardine said furlough should be maintained for another six months for 10 industries particularly badly affected by the pandemic, such as air travel.
“The withdrawal of furlough risks having a devastating impact on countless families already facing a winter of soaring energy bills,” said Ms Jardine.
“The government needs to rethink its approach or the country could face a Coronavirus Black Thursday.”
The party says the extension would cost about £600m.
This comes after thousands of people, including key NHS staff and teachers have said that they are unable to get to work due as a result of the national fuel shortage crisis, with some facing the prospect of potentially returning to working from home where possible.
Chancellor Rishi Sunak said: “I am immensely proud of the furlough scheme, and even more proud of UK workers and businesses whose resolve has seen us through an immensely difficult time.
“With the recovery well underway, and more than one million job vacancies, now is the right time for the scheme to draw to a close.
“But that in no way means the end of our support. Our Plan for Jobs is helping people into work and making sure they have the skills needed for the jobs of the future.”
Following the end of the furlough scheme, the government has launched a £500m support package for vulnerable households over winter.
The new Household Support Fund will help people with essentials over the coming months and will be distributed by councils in England.
It will be available as small grants to meet daily needs such as food, clothing, and utilities and will be available to councils from October.
The devolved administrations will receive up to £79m of the £500m.