UK's Rishi Sunak Unveils 'Job Support' Boost to Cover Covid-hit Wages
FILE PHOTO: Britain's Chancellor of the Exchequer Rishi Sunak speaks during a daily news conference on the coronavirus disease (COVID-19) outbreak, at 10 Downing Street in London. (Reuters)
The finance minister said eligible businesses will receive grants to pay the wages of staff who cannot work and two-thirds of each employees' salary, or 67 per cent up to a maximum of GBP 2,100 a month, will be covered by the UK Treasury.
- PTI London
- Last Updated: October 9, 2020, 23:25 IST
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UK Chancellor Rishi Sunak on Friday unveiled a booster shot to his previously announced 'Job Support Scheme' to cover a chunk of the wages of businesses legally required to shut in the coming weeks as part of local or national coronavirus restrictions. The finance minister said eligible businesses will receive grants to pay the wages of staff who cannot work and two-thirds of each employees' salary, or 67 per cent up to a maximum of GBP 2,100 a month, will be covered by the UK Treasury.
"The expansion of the 'Job Support Scheme' will provide a safety net for businesses across the UK who are required to temporarily close their doors, giving them the right support at the right time," said Sunak. "Throughout the crisis the driving force of our economic policy has not changed. I have always said that we will do whatever is necessary to protect jobs and livelihoods as the situation evolves," he said.
Asked if the announcement indicated tougher measures are in store for certain sectors of the economy, including hospitality, Sunak added: "The rise in cases and hospital admissions in certain parts of the country is a concern. It's right the government considers a range of options... but it's also right they engage with local leaders." It is widely expected that UK Prime Minister Boris Johnson is set to announce further closures for restaurants and pubs on Monday in areas of England seeing a spike in coronavirus infections. Under the expanded 'Job Support Scheme' to begin from November 1, employers will not be required to contribute towards wages and only have to cover a small proportion of overall employment costs, such as pension contributions.
Businesses will be eligible to claim the grant only while they are subject to lockdown restrictions and employees must be off work for a minimum of seven consecutive days to qualify. The scheme will be in place for a period of six months, with a review point in January 2021.
While the Opposition Labour Party criticised the delay in the announcement because it caused "unnecessary anxiety and job losses", regional leaders dealing with localised lockdowns have called for more help for struggling firms. However, the government said Friday's announcement comes alongside intensive engagement with local leaders on potential measures in their areas.
In addition to expanding the 'Job Support Scheme', the government said it is increasing the cash grants to businesses in England shut in local lockdowns to support with fixed costs. This is aimed at benefiting hundreds of thousands of businesses, including restaurants, pubs, nightclubs, bowling alleys and many more that are unable to function as a result of the restrictions on gatherings.
The devolved administrations in Scotland, Wales and Northern Ireland will benefit from a GBP 1.3 billion increase to their guaranteed funding for 2020-21 allowing them to continue their response to COVID-19 including through similar measures if they wish, the UK Treasury said. The latest set of measures are said to build on the government's wider package of unprecedented measures to help protect, create and support jobs through the pandemic, to ensure that "nobody is left without hope or opportunity".
It comes as the Office for National Statistics (ONS) warned that coronavirus cases have "increased rapidly" in England, based on its latest survey and the government's Scientific Advisory Group for Emergencies (Sage) says it is "almost certain that the epidemic continues to grow exponentially across the country and is confident that the transmission is not slowing". The coronavirus has claimed 42,682 lives with 564,518 confirmed cases in the UK.